Loki, Thank you for your response. Apologies for the delay the system imposed a 7 day wait before I could respond. I'm actually pretty comfortable with how I am using the LW until now as I have been playing an aggressive approach as the German. I'm at the gates of Leningrad, Odessa has fallen and the Wehrmacht is taking a break to recuperate before pressing onwards. I have inflicted 1.7M Sov casualties against 224K Axis ones and 12,700 ac casualties on the Sovs against only 1,098 for the LW so the loss rate is not only massively in my favour but I'm actually increasing the LW/Sov ratio in my favour as well so the LW is 'winning'. Whilst I 'only' have 378 F-2 and 96 E-7s online, I also have ~200 in need of repair as advancing quickly means repairs are slower, the Sovs have virtually no Ftrs by the middle of each turn as their loss rates have been so high.
I have been using an approach similar to that you suggest - balancing the use of drop tanks, resting JG etc and unit fatigue and morale are both 'low' and 'sky high' in fact the high experience rates means I typically inflict 7-10:1 casualties on the Sovs. The problem is mainly the high operational loss rate and that the that the pool of replacements is empty so the sudden loss of replacement Ftrs for the LW due to the 'upgrade' to the F4 will let the Sovs recover whereas in reality the Germans kept a smooth flow of ac going. Hopefully the new 1.07 Beta will fix that.
As an aside, the date for the F4 update in the game is itself is another issue. According to LW archives the first F4s were produced in May 41 (not Aug) and several Staffel and JG had mixed F2/F4 inventories at the start of Barbarossa. More importantly, uniquely, the Germans produced several field kits to upgrade F2s to F4s to keep Ftr strength up and standardise on the F4 without ac rotating back to factories in Germany for upgrade/repair which was the usual German practice. A compelling argument could be made for the F2/F4 update to be an exception to the usual rule as the Germans made special efforts to keep Ftrs flowing at the start of Barbarossa and, as an exception to later practice, production lines switched serially with F2s/F4s being in production alongside each other in factories whereas the normal practice was to update production lines to the new model which would indeed result in an approximation of rule 28.4.2. However, that is a separate issue. A further separate issue is how many ME-109 pilots are being captured during battles - especially when the hex is won by the Germans and the LW have been intercepting Sov ac providing ground support.