• They only target missiles aimed at your ship
This makes them a very selfish thing to load, as they are only useful when you specifically are under attack by missiles.
You and your fleet will almost always benefit more by loading a missile type that can actually do damage.

• They all target the same missile

• Defender Missiles can intercept missiles aimed at the player or anyone on their watchlist
(as long as the incoming missiles are within range).

• Defender Missiles target a random missile when launched
(defenders launched from grouped launchers will target the same missile, allowing you to shoot down larger missiles).

• Missiles closer to the player's ship are more likely to be chosen as targets.
• Shooting down a missile aimed at another player is considered remote assistance, with the same consequences.
You cannot shoot down missiles aimed at players in Triage, activating an Entosis Link, etc...
You inherit the flags of the player the missile was aimed at, and can get a suspect flag if you interfere with highsec duels.
Your safety settings can prevent this, causing your defenders to ignore missiles that would trigger the appropriate flag.

• 10% TiDi fights give ample opportunity to reorganize watchlists, potentially allowing the primary to be shielded by everyone in fleet.
• Could make missiles an unpopular choice for small gang pvp, with knock-on effects.
• Missile HP / defender damage might need tweaking so that solitary Talwars / Caracals don't suddenly become able to nullify battleship damage output.
• Not all Logi have launcher hard-points.

Theory-Crafter, Free Agent, Immortal Space Pirate. Generally Crazy and difficult to understand at times.