It does that because if you had a different character blocking the guard's path to your other character.
Here's an example using attack range: If you have a guard in space B1 (I'm using Battleship labeling) with a 6 space movement range and you have Oscar in space B5 and Ike in space B7 the guard won't be able to reach Ike because he'd have to move 7 spaces in order to be in adjacent square. (3 spaces over to B4, 1 space up/down to space A4/C4, 2 spaces over to space A6/C6 and then one more space (either B6, A7 or C7) to get next to Ike.) However, once you move Oscar out of spaces B2 to B6 range the guard has a straight 6-space shot to Ike and can attack.
It's the same principle for movement and being spotted range. If you have someone blocking the guard's path he won't be able to reach a certain spot. So you think to yourself "A-ha! I'll move this guy over here and then he'll be safe. Unfortunately, you have to make sure that by moving that character you don't open up a direct route to a different character that can then be spotted.
Chapter 10 is a pain. I did it using stealth, but I'm not sure if it's worth it. If I had to do it over again I'd probably just say screw the bonus experience and take everyone out.
EDIT: Since I'm such a nice guy, I even found you a walkthough so you can beat the chapter with the bonus experience if you like.
Fire Emblem: Path of Radiance FAQs & Guides. Go there and select Ask_B_007's walkthrough (first one in the list). Then do a Ctrl + F and search for [FE10.1]. I didn't use this guide, but I know people who did and it seems to work just fine. For some reason he doesn't recruit Kieran (which I think is a mistake) but I'm sure you could easily add him to the to-do list as the guards rotate on a cycle and it shouldn't be too difficult to find a pattarn to get Oscar over there.