CoH is generally much more interactive than Steel Panthers (SP). In SP, you played your turn, planned out your attacks and then watched it happen. There was opportunity fire as well that broke up the turn sequence as well.
In CoH, you make a move, the enemy makes a move, you make a move, the enemy makes a move, not just piece by piece but move by move. So there is no need for an opportunity fire mechanism like SP has because every move, you or your opponent will have the chance to fire or move or whatever. The exception to this sequence is really in planning your offboard artillery which you do at the beginning of the turn. Turn length is also variable in essence because it ends when both sides pass. Both sides can pass long before your units run out of actions so it adds another dynamic that SP does not have.
As far as realism goes, I would say it depends on what you are looking for. CoH boils your attack and defense down into a few factors so it's much easier to tell what can beat what. Also, individual squad weapons are not considered like they are in SP. That is, in SP, you know a squad is carrying satchels or bazookas or what not. But in CoH, it is more abstract. SP was much more complex also with regard to armor penetration values, turret vs hull armor, etc... so you may consider it more realistic but on the other hand, CoH was intended to model a boardgame, and no boardgame that you can finish in a couple hours could possibly handle all the factors that SP does.
There's still complexity in CoH such as armor vs non-armor, front vs flank, range, smoke, and terrain all are important things to consider so you still have to put a good deal of thought into it. If you judge realism by getting the expected results in 'realistic' situations than CoH is certainly as good model for realism as any boardgame of that type. Of course, in any game, you always have that luck element!
If you haven't already, take a look at the AARs to get a better feel for the gameplay, especially Mo Reb's beginners AAR.
PS There are difficulty options but I'm not sure how much under the hood I can talk about so will let Matrix answer that one.