Does a ship that declares a retreat still get to attack and move?

Also what is meant by 'discarding a command dial'?

When you would Reveal the Command Dial (ie, what command it has this turn)... You don't declare what it is, and you simply set it aside, stating, "I am declaring a Hyperspace Retreat".

So, No Navigate, Squadron, Repair or Concentrate Fire. Regardless of what that dial says, it means nothing .

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Then continue to Move and Shoot.

If you're still alive and on the board at the start of the End Phase... Whoosh, you Hyperspace out.

- The only caveat being, if there is an enemy ship that has the Experimental Retrofit Slot within Distance 5 (and it means just has the slot, they don't even have to have anything in said slot), you cannot discard your dial at the start of your acivation. You'll have to reveal it as normal.

Note that as well, that means if it starts outside of distance 5, and moves in during your turn, after you have Declared - you still get away.

Interdiction only works when you go to discard your dial.

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Its also not the only game-mechanic that makes you discard your dial. There's at least one critical effect that does that, too. Discard means "pick up and return to the supply" usually, in the most generic of game terms.