I have adapted my mod for BAI engine and testing it now. Some initial feedback.
AI acts like player would: spots an enemy and kills it with all firepower. Which is pretty neat. Taking cover, smoke, motion detectors, remembering enemy positions, anticipating enemy move is more important now. It becomes true game of intellects like chess. Amazing. Thank you for this mod and you hard work on AI.
Numbers of forces are extremely important now. Fighting larger USO is noticeably more difficult and terror missions are a slaughterhouse. I don't even bother going to terror sites without personal armor. And even with personal armor I encounter serious casualties.
Smoke helps against small number of enemies located in one direction (small USO recovery). For large number of opponents I have to surround my troops with complete circle of smoke plus make sure I extend it high enough to be hidden from high views as well. Still somehow they manage to see through some holes in smoke and notice at least one of my units and then unleash the hell on it until its dead. This is especially pronounced during terror mission when deployment location is surrounded by aliens from all sides including some at second-third floors. Even continuous wall of smoke does not help in these cases.
Due to AI being smart the battle is most intense at the beginning when they both sides have maximal number of units. As soon as alien strength is broken it makes it somewhat easier to hunt for last ones. Same is true when player team strength is broken. Then it is wiser to just bail out. For terror missions it turns into absurd: aliens cannot even let me get out of the transport to establish smoke screen at times. And if I dare to get out without smoke screen hoping to set it up next turn, they kill half of my army effectively ending my assault. First few turns and luck in transport positioning defines the battle.
They shoot across whole map with sonic and arch weapon (deep ones). True that players do the same at their leisure. However, when number of units is high at each side, spotted unit is dead same turn. Being spotted becomes the biggest fear. No amount of armor helps as they keep shooting and throw grenades until unit is dead. With PWT launchers they just slaughter X-Com troops in few turns. Looks like there is threshold number of aliens beyond which it is impossible to fight them.
They use up ammo and grenades extensively. They also quite often carry primed grenades effectively wiping out all dropped inventory. This seriously impact recovery income.
Some thoughts of what can be improved regarding the above. Not the suggestion for this mod. More of thinking out loud. Maybe I can do this in mine.
Probably reduce involvement of far units into the shooting. Either introduce max shooting distance or let aimed shot precision to diminish as well with extender accuracy.
Maybe also reduce accuracy when shooting target that is not directly visible (radio targeting). Maybe further reduce accuracy when shooting through smoke/fire and the like? This way smoke may play less role in covering but more role in blurring units and give them survival chance.
Grenades destroying fell inventory is fine. I can probably just increase item cost to compensate.
Maybe give AI and X-Com initial spacing. Do not place them immediately next to each other at turn one? Give both parties chance to create a formation. Otherwise, Xarquid or Biodrone hanging right across transport door will put a stop to any attempt to disembark.
Rework smoke mechanics. Make it more protective in all direction including height.