Restore lost resolution? How can resolution be restored once it is lost? Do you really mean accutance, perhaps?

You cannot restore lost signal, but the thing is that with diffraction (and many other types of distortion) the signal is not lost, just distorted. If you know the shape of the function that distorted the signal you can make an inverse function and run the distorted signal through that and restore the original.

So even if the signal is totally blurry, if the blur function is well-defined you can "run it backwards" and restore the original -- that is what deconvolution is about. Deconvolution is a mathematical process that is used in many signal processing applications, not just in photography. It is often used in audio applications for example.

However, if the signal has been distorted with a function that totally cuts off parts of the signal (not just shuffles it around) the original cannot be restored. Fortunately diffraction is a relatively well-behaved type of distortion that keeps all signal and only blurs it (randomly though which is bad, but with a specific probability function so with enough signal it becomes well-defined).

To make a perfect inversion (deconvolution) you need perfect signal without noise and have the exact distortion function (point spread function, PSF), which you in practice won't have, so what you today can achieve with deconvolution is quite limited, but I find it useful in many images, not only for diffraction but also for example to enhance sharpness in long exposures when there's been some vibration problem.