The square root method is good to retain constant power, but you still might want to take a look in the ExamplesOverview patch from the Extras menu to see the method used there. You could use a similar patch to draw any sort of response curve you like.
The reason for this is simple. When you hear something, you hear it in a full radius around you, not from one or two directions. Stereo presents Sounds to you with two speakers, right and left. Also called Right and Left Channels.