So you are entering summer 42 holding Leningrad, Moskow, Rostov, and recently suffering a few setbacks much like in real war. Both sides are much bigger than historical though. You can afford heavy manpower losses, and it won't be german losses that stop the germans in this drive either.
Leningrad is indeed overdefended, but in a month you will be sure you have deterred him and you will then hold Leningrad for rest of game. Those units on Finnish side are there to gain experience and be quick reinforcements if needed, fortified zones won't do that for you.
Moskow is heavily defended, you have lot's of time to evacuate the remaining industry if needed, why waste the downtime on production unless it's needed? No reserve rail seems to help supply the large army. He's hitting hard in the center, but a right hook around city without a left hook is unlikely to succeed.
He's going hard to drive deep in the center, keep your quality units intact, ready to defend your stop lines, and you'll survive 42. Victory is pretty tough without leningrad and moskow, no matter how many vp they pick up in the deep center.
Come 43, you'll be happy the germans are so far extended.