I don't see the advantage of hiding the implementation in this case. The new name doesn't give any new insight, nor provides any useful abstraction over the list comprehension syntax. It only raises question marks in the reader's head: where is this defined? Does it have side effects? Am I OK to mutate the returned list? The passed list? Am I OK to assume the passed list unchanged? etc.
Re: different ways to traverse a list and square elements, whenever the idiomatic implementations in your language are good enough for you, you just want to go with them. Hiding those details behind names is premature abstraction IMO. If you know you'll need your own list and square implementation, you can abstract that from the start. If you find needs for change that you didn't anticipate, the overhead of refactoring (or overloading operators, if it suits the problem) there and then is probably less than having abstracted everything that you might possibly want to change.
Deciding to square the list in place is not trivial at all. If you do that, you'd better change the signature of the function so that it doesn't return anything [Edit: or using whatever convention you have to highlight mutators, like bang! names in Scheme]. Otherwise, it's too easy to use the old list assuming it has the original values, or to mutate either the old or new references assuming they belong to independent lists.
Re: readability, you have to balance the familiarity of the syntax for a newcomer, and more importantly, the ease with which you can get acquainted to it, with its expressive power and its consistency with the rest of the language. If English was precise, concise, unambiguous, and consistent enough a notation, we wouldn't have many other programming languages.
More specifically, I find list comprehensions (and generator expressions in general) very quick to get used to, I find that they read well once you have acquainted yourself with them, I find that they have a great ink to information ratio that justifies making that initial learning investment, and I find that they feel right at home in Python.