I attacked with Squee and Goodric, Squee then added an additional attacker however Witchstalker Frenzy only reduced the cost by 2 when it should have been 3

In the screenshot below the cost of Withtalker Frenzy should be reduced to two.

I think this is the relevant rule:

508.4. If a creature is put onto the battlefield attacking, its controller chooses which defending player or which planeswalker a defending player controls it's attacking as it enters the battlefield (unless the effect that put it onto the battlefield specifies what it's attacking). Similarly, if an effect states that a creature is attacking, its controller chooses which defending player or which planeswalker a defending player controls it's attacking it becomes attacking (unless the effect has already specified). Such creatures are "attacking" but, for the purposes of trigger events and effects, they never "attacked."

TLDR: creatures entering the battlefield attacking are attacking but never attacked.