function not working

Don't use blanks and other special characters in your directory and file names you use in Sikuli. There are some problems.

to test your workflow put the following in one script:

def square(x):
   r=x*x
   return r
# since def: starts a new block, you have to indent the statements belonging to your function

print square(9)

this should work.

then you can put all your functions in one script, that you store in a central place:
myFunctions.sikuli.

At the beginning you use:
execfile("path-to-your-function-repository\\myFunctions.sikuli\\myFunctions.py")

this reads and executes all python code available in myFunctions.py (I prefer this to "exec open().read()")

On more comment:

you said:
#I have stored the following in "desktop->my Functions->square.sikuli"

and used:
c:\\users\\desktop\\my Functions\\square.sikuli\\square.py
as file name. I suppose you are windows, since you use \\
I think this is wrong, should be something like. if it is stored in the real windows desktop.
c:\\users\\yourName\\desktop\\my Functions\\square.sikuli\\square.py

One more comment:
If you have any problems, pls. give some info on the symptoms (what kind of error, error messages, ...)