[SQB]

Outpost Aggression and Defence Range

Your outpost aggression level doesn't really matter until you get a zone of control around it, a defence range. (ie: upgrade Barrack to Guardhouse to get one tile defence range all around it. Upgrade that to a Watchtower for two tiles around it. Stronghold is 3 [see Imperial City (0|0) on map, for a picture).

With 'Neutral', you defend only the outpost itself.
With 'Defensive', you defend your outpost and any of your villages or outposts within your defence range (from 0 to 3 tiles around it). You defend with all troops in the outpost, be they geologists, scouts, or whatever. Defensive troops like Town Militia or Knights work best for defence.
With 'Aggressive' setting, you attack any armies that make a military camp within your defensive range. Better use attack troops for this.

If you are aggressive, the battle is with you attacking. If you are defensive, the battle is with you defending from the Outpost combined with whatever is attacked. As long as you have troops left for it, the outpost will attack/defend multiple times per second and multiple areas, no troop movements required. Choose your troops wisely, and two Guardhouses (or better) if you can do it.

Credit -- John_Doesy