Hypersmurf
Moderatarrrrh...
On your turn, you must engage or target a different creature.
Exactly.
That isn't a question. The question is "how long do I have until I am counted as failing to engage?"
In the simplest example, Bob challenges Mon then move adjacent to Mon then attacks. On Mon's turn, he attacks. Back to Bob, he decides to use a ranged power so he shifts back. At this point, he has failed to engage in the turn: he hasn't attacked and won't be adjacent at the end of the turn.
You hand wave this by only checking for "engaged" at the end of the round. Why is that more correct than after every action?
Because "On your turn, you must engage your target or challenge a different target."
At any point before the end of your turn, you still have a chance to do it "on your turn". Once the end of your turn arrives, you no longer have a chance to fulfill either of those conditions "on your turn".
At the point where Bob shifts back, he has not yet engaged, but we won't know whether he has failed to engage on his turn until his turn is over.
Now, instead of making a ranged attack on Mon, Bob now challenges Al. He has fulfilled the condition of the Challenge on Mon - on his turn, he either engaged Mon or challenged a different target. So the Challenge on Mon will not trigger the "can't use DC next turn" consequence.
But he's just used Divine Challenge on Al, and Divine Challenge has a condition - "On your turn, you must engage the target or challenge a different target." So on his turn - before the end of his turn - he must engage Al, or challenge a target different to Al.
-Hyp.