I think I have the right answer for this, but I am checking to be sure:

Playing a 2 player game, I had an enemy engaged with me with 2 HP remaining. The enemy had Forest Snare attached to it. We started the Combat phase and gave it a shadow card. My buddy wanted to then play Swift Strike and declare his Sentinel as the defender, expecting to apply the 2 HP of damage from the event and dispense with the enemy.

My take is that, with Forest Snare, the enemy cannot attack. Therefore, the 4 steps of resolving an enemy attack cannot occur, including the step at which a defender is declared. This would mean that Swift Strike cannot be played with the result of assigning damage to an enemy that has Forest Snare attached to it.

Is this correct? Or does "cannot attack" mean the other steps of resolving and enemy attack are still executed?

~Bene

You were correct in your interpretation of the rules. The four steps in the rulebook are a means of resolving each attack; if an enemy cannot attack, you do not go through those steps, including declaring a defender.