Engagement means if you walk into someone using a melee weapon, you will take attacks of opportunity if you attempt to move away from him. You start out only able to engage two people, but you can increase that amount with the right fighter skills/defensive feats.

Deflection is basically AC, it's a form of damage reduction for physical attacks. More deflection = better.

Lemme copy paste some stuff I wrote for another board:

Character creation:

DO NOT MAKE A ROGUE. They are exceedingly terrible at the start. Backstabbing has no value, and tends to create dead rogues as they end up very far out of position after the initial stab. If you absolutely must roll a rogue, sneak attacking with arbalests from range will do more than three times the damage of a backstab, and won't put your rogue in a s***ty position, so you should look to get one of those as soon as possible.

Furthermore, the other big role of the rogue, detecting traps and hidden stashes, is based on the mechanics skill, which literally any character can increase. I suggest investing a mage in the mechanics skill, since you'll probably be running multiple mages and you don't need multiple people with lore.

Finally, the high rogue sneak attack damage is very conditional - you need the rogue (or someone else, usually a mage) to apply conditions to the enemy which allow sneak attacks, and the rogue can only sneak attack one enemy at a time. Rogues also get heavily punished for disengaging an enemy on them and moving to a higher priority healer or mage. This means that all the toughest fights, notably boss fights, which involve forced dialogue (i.e. no opening sneak attack) and you being heavily outnumbered and swarmed (i.e. rogue can't easily switch to important targets to sneak attack), are all the fights which the rogue is by far the worst at dealing with.

DO NOT INVEST IN STEALTH. It is only useful for the first attack of the fight, if you are a rogue with sneak attack, and even then a party with ranged weapons will get the first attack anyway, 99% of the time, with 0 stealth at all. Also, there are multiple events and dialogue options which require high lore/survival/athletics/mechanics, but I've yet to see a single one that requires stealth. Its possible there is one, but they're very rare in my experience. If you are running a rogue, stealth also reduces your investment in mechanics, so its kinda s***ty even so. It's a bad, bad stat.

WHEN IN DOUBT, DRUIDS ARE KINDA OVERPOWERED. Nothing else to say about it. Their spells are all incredibly useful, even at level 1, while mage level 1 spells all kinda suck, except for slicken. Burning hands does good damage, but usually you'll end up roasting your tanks in the bargain, soooooo....

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The beginning:

After the prologue, when you are alone and running to the first town, DO NOT EXPLORE THE MAP. f*** off and get to gilded vale as soon as possible. Many of the encounters range from difficult to impossible as a single character, unless you're someone extremely strong on their own, like a druid or a high deflection melee class.

At gilded vale, your first order of business is to acquire companions. Aloth is right outside the inn, impossible to miss. Eder is next to the tree, make sure to talk with him *after* you rest in the inn and talk with a soul - you can't recruit him when you first meet him and I missed recruiting him my first time through because I didn't talk to him later. Buy a level 1 companion at the inn, I suggest making another tanky melee class so that Eder isn't on his own. If you're already a tanky melee class, I suggest a high damage class that isn't rogue.

Go south of gilded vale and recruit the priest on the road.

After you have 5 companions, the temple dungeon is much easier to deal with. Save before every fight, just in case. Make sure one of your characters is invested in mechanics so you don't miss some of the hidden stashes and locked chests and traps.

Also make sure that you have camping supplies - buy at least 3 from the inn before you head to the dungeon. The temple dungeon, when you have your companions, is fairly easy, but I suggest that you try and maintain max camping supplies for the rest of the game, since they are key to clearing out maps and dungeons. Every time you find a camping supply in the dungeon, you know you can win the next few encounters, come back, rest, and then resupply yourself immediately after.

After this dungeon is completed, you should be free to quest as much as you like. Make sure to talk to wirtan after it's done (I forgot to). I suggest going to Caed Nua and recruiting Kana just outside and completing the quest there, before you head to Roedric's keep.