I think you are pointing at the right symptom in your analysis of why you are where you are: you are facing a red army which is already huge by early 1942. From looking at the numbers at the end of T17, it seems clear the root cause dates from the summer 1941 campaign.
If I compare Oshawott's Red Army compared to my game against JC, at T17:
Oshawott 1.85M 5.6M
JP 3.4M 4.1M
Even with my much lower numbers, I managed to stop my opponent's offensive in July 1942, and have been pushing back ever since. So I don't see how you stood a chance after T17, barring a major fubar from Oshawott.
I also had lost Leningrad and Stalino, Oshawott did not.
It's hard to see what happened in 1941 since the AAR is light in details for the first few turns. But looking at numbers at T5 and T10, it looks like Oshawott was free to run east and take few losses early on, and by T10 already had a mighty army, combining all the units that retreated and reinforcements. In my game against JC I committed to fight forward, so I took higher losses (I only lost Kiev at T12!). Yet I still ended up gaining the upper hand in 1942.
So I think if a good Soviet player is free to just run east, unless the German player is very skilled, knows all the good cheese :) and opens with a huge Lvov pocket, the game is hugely to the soviets' advantage.