30 day squat challenge and muscles resting

No good reason to squat everyday. If you can you're either not pushing yourself hard enough to need a recovery day, in which case you won't get the results you want OR you are sufficiently pushing yourself in which case you wouldn't be giving yourself adequate time to rebuild the muscle you broke down. Also squatting every day is probably going to start taking a toll on the menisci(shock absorbing cartilage) in your knees unless your form is absolutely immaculate. In my opinion you need at least 72 hours between leg workouts. Get in there, squat till you can barely walk, and then work on your upper body for the next 2-3 days. Your legs don't get stronger/more muscular from doing insane number of squats every single day, they grow from hard workouts coupled with proper nutrition and adequate recovery time to allow for muscular repair/hypertrophy.

Yes ignore them, you will get much better results from heavy squatting vs. dozens of body weight squats daily (with only a couple rest days build in). If you did them on your "rest" days your legs wont be recovered enough for the next workout.

I think because the challenge is just body weight that you wont need much if any recovery from them, unless you are doing 100s/day.

I don't agree with the 72 hours rest period, 48 should be more than enough. You can work through the stiffness and soreness, just not if you have pain. Many beginner full body heavy lifting strength training routines have you squatting 3 times/week (M,W,F) Starting Strength (good book too), stronglifts 5x5 (and its variations)

I agree with MJUDD, I did the squat challenge and by day 12, my knees hurt so badly, I literally could not work out for over 2 weeks, I over did it!