1. Heat oil in 12-inch nonstick skillet over medium-high heat until shimmering but not smoking. Add about 3 1/2 cups squash in even layer and cook without stirring until golden brown, 4 to 5 minutes; stir in 1/4 teaspoon salt and 1/4 teaspoon pepper. Continue to cook, stirring occasionally, until squash is tender and browned, about 5 minutes longer. Transfer squash to bowl and set aside.
2. Return skillet to medium heat; add reserved squash fibers and seeds and any leftover diced squash. Cook, stirring frequently to break up fibers, until lightly browned, about 4 minutes. Transfer to large saucepan and add chicken broth and water; cover saucepan and bring mixture to simmer over high heat, then reduce heat to medium-low to maintain bare simmer.
3. Melt 3 tablespoons butter in now-empty skillet over medium heat; when foaming subsides, add onions, garlic, remaining 1/2 teaspoon salt, and remaining 1/2 teaspoon pepper. Cook, stirring occasionally, until onions are softened, 4 to 5 minutes. Add rice to skillet and cook, stirring frequently, until grains are translucent around edges, about 3 minutes. Add wine and cook, stirring frequently, until fully absorbed, 4 to 5 minutes.
4. Meanwhile, strain hot broth through fine-mesh strainer into medium bowl, pressing on solids to extract as much liquid as possible. Return strained broth to saucepan and discard solids in strainer; cover saucepan and set over low heat to keep broth hot.
5. When wine is fully absorbed, add 3 cups hot broth and half of reserved squash to rice. Simmer, stirring every 3 to 4 minutes, until liquid is absorbed and bottom of pan is almost dry, about 12 minutes.
6. Stir in about 1/2 cup hot broth and cook, stirring constantly, until absorbed, about 3 minutes; repeat with additional broth 2 or 3 more times, until rice is al dente. Off heat, stir in remaining 1 tablespoon butter, Parmesan, sage, and nutmeg; gently fold in remaining cooked squash. If desired, add up to 1/4 cup additional hot broth to loosen texture of risotto. Serve immediately.
STEP BY STEP: Dicing Squash With its tough outer skin, bulbous base filled with seeds and fibers, and long, skinny neck, butternut squash can be a formidable foe when you approach it with a knife. But if you follow these steps, you'll have evenly diced pieces in no time.
1. After removing skin with peeler, cut squash in half.
2. Cut bulb in half through base and remove seeds with spoon.
3. Cut each piece into 1/2-inch half-moons, then into into 1/2-inch dice.
4. Stand neck on end and slice into 1/2-inch planks. Cut planks into 1/2-inch strips, then into 1/2-inch dice