From: Eagle River, Alaska
I ran the intro scenario as the German player last night and although I failed to save the game due to my own stupidity, the air-to-air results looked very reasonable given the forces involved. Unfortunately the AI plotted the US raid to return over the Ruhr which made for a great day for the FlaK gunners - not to mention that "return to last waypoint" bug hit one of the bomber formations which brought it back into the Ruhr! A ton of damaged bombers crashed on landing. Even so, the "score" was 71 Allied (I think about 5 fighters in there) vs 29 LW losses. Without the FlaK I guess the US losses would have been in the 50's.
My only concern is that in a long game, with lower losses all you will achieve is a better equipped defender, while the attacker only gets less lost pilots. The attacker has to work hard to run out of aircraft, while the defender always has to be careful. If the defender loses less AC & Pilots, then there <edit: zomg!> will be more newer types out there, and more high-xp pilots.
I personally don't like the idea of "play balance" at the cost of history - although I acknowledge I am probably a minority on this. Logically, if both sides have lower losses it shouldn't have any impact - UNLESS the German production capacity as already been juiced up for play balance. Then yes I can see how lower losses is going to give the LW an ever-increasing advantage in aircraft numbers. As far as pilot losses and having more experienced pilots, I would hazard to say that I can't imagine this being a problem given how quickly named pilots get eliminated. As others have noted, when playing the 1943 campaign, by the time 1944 comes around all the well know named pilots are dead or MIA. Lowering the loss rate should be a benefit in this regard. Unless tested fully though, we can't really know, can we? The harder I look the more I realize the number of variables (randoms) which must be built into the code at seemingly every conditional statement.