So, a common complaint with AIWC is that high-cap ships are worse than low-cap ships. The quintessential example is the laser gatling. Correct me if I'm wrong, but a major reason these high-cap and small unit ships are bad is that they have a quicker dps falloff than low-cap ships (since they lose units faster). Now, my mental model of how squad-squad combat works may be outdated or incorrect, but here's a possible solution I've thought up. This is assuming that a squad can lose individual ships, reducing its dps.
Squads with more ships in them lose ships asymptotically slower
Thematically, this would be high-cap squads spreading around the damage to each of their members; the more members you have the more you can spread around the damage.
I'm not sure whether it would actually work, or even make sense; I just thought of it during class today.
And I could be totally off about squad-squad combat and squads don't lose dps as members are killed (or members just can't be killed, until the squad hp hits 0 and the entire thing dies)