...Regarding the Dnieper defence I would argue that if you can hold that line through 1941, you're playing on too easy a setting. Don't lose sleep over the colapse of this defence line, it should at best be a temporary barrier to the German advance. If the Germans can't crack it in 1941 you'll just end up with a short, unsatisfying campaign that will end in Russian victory in 1943, or mid '44 at the latest. Against the AI, the Germans will simply sulk on the west bank of the river for the rest of the game, until you decide to take the initiative and kick them all the way back to Berlin.
Disciple, thanks for this little tidbit of advice.
I was playing a GC as the Russians on Normal difficulty and I was quite proud that I was able to defend the Dnieper, Leningrad, and Smolensk. Then the AI did just what you said: they sulked behind river and never launched any serious action against me. This allowed me to build up a massively strong line by November. I started launching minor counterattacks, to which the Axis responded by pulling back. It was the start of the end for them.
As you said, if I am going to invest dozens (hundreds?) of hours on a GC, I want it to be interesting. So I started over on Challenging difficulty and boy am I happy I did. The new AI rushed the Dnieper and crossed it by turn 2. It is kicking me in the teeth around Smolensk and it is aggressively pushing towards Bryansk and Leningrad. I don't know if I can hold and my replacements can't arrive fast enough. Needless to say, the Challenging AI is a vast improvement to the Normal AI and this has made the game much more interesting (albeit a lot more stressful). From my experience, I suggest that the GC be played on Challenging at a minimum as you will have a better experience. The AI is simply more aggressive and it is a lot more fun.