The AI's tendancy to run away was always the main game breaker for me, but after reading a post that said, 'play on challenging' I decided to give the game another try.
On turn 2, playing the 1943-45 campaign as the Soviets on challenging, the AI pulled back all its forces around the Kursk salient. I had not attacked any AI units on Turn 1. The AI even abandoned a city (Belgorod) without a fight.
I know that T1 is programmed, reflecting what an expert player has recorded as the ideal first moves. After that, the AI makes its own decisions, leading to sensible but a-historical moves. After all, a really sensible Axis strategy would have been never to attack the Soviet Union in the first place.
What is missing from this game is the insanity emanating from Hitler's HQ. The game needs 'No retreat' settings at the strategic level, whereby no retreats would occur unless a unit has been attacked and is threatened with being cut off. In fact, the Axis forces were regularly cut-off and prided themselves with being able to escape from pockets.
Perhaps the ZoC movement cost for Axis units is too high? The more experienced the unit, the greater its ability to move through ZoC, combined with retreat limiting settings? Would this help?
Finally, cities were generally turned into fortresses and the defence centred on these. Currently, it seems that the AI treats a city the same as it treats an open terrain hex. Will all this change in WitE 2? If not, what a shame that will be...