If we take an equation $f(x)=f(\sqrt{x})$ defined for positive $x$ then it is quite easy to see that it is constant; $f(x)=f(0)$ if continuous at zero.
My question is: What would happen if we take $f$ to have a discontinuity at zero? Do we simply get a constant function everywhere but zero, or does the answer change completely?
Your original statement is not quite right. Instead, we have
If $f$ is continuous at $0$, then $f$ is constant on $[0, 1)$.
If $f$ is continuous at $1$, then $f$ is constant on $(0, \infty)$.
If $f$ is continuous at $\infty$ (i.e. $f(x)$ has a limit as $x \to \infty$) then $f$ is constant on $(1, \infty)$.
If you do not require $f$ to be continuous at one of these three points, $f$ could be very irregular. See this as follows:
Define a function $g: \mathbb{R} \to \mathbb{R}$ however you please on $(1, 2]$ and $[-2, -1)$. Also define $g(0)$ however you please.
Let $g(2x) = g(x)$ for all $x$.
Finally, let $f(x) = g(\ln x)$ for $x > 0$, and let $f(0)$ be whatever you want.