OK, I'm working through this post now. Some good points raised here. To answer the main ones:
Early Tech Tree: The functionality for upgrading items into other items is now in the game and will be arriving in V10, so the early-game tech tree now contains two upgrade projects that allow you to upgrade your Ballistics to do 20% more damage, or upgrade your Combat Armour into the Warden Vest which gives substantially more protection (both cost 10 Alloys). I've therefore made the starting Combat Armour a bit weaker (20% Resist) and the Warden Vest offers 30% Resist, whereas the Wolf-equivalent armour offers 55% resist.
The idea here is that players can either spend resources to do a quick "bridging" upgrade for their starting equipment, or they can skip past it to try and reach the Lasers / Wolf as fast as possible - but that would mean using basic ballistics and conventional armour until about the time Destroyers (formerly Corvettes) start arriving. As an aside, I'm a little unconvinced about how well resistance %s are working for the armour system and I'm tempted to experiment with having armour add bonus HP to soldiers instead. But that's a discussion for a later date.
Air Combat: The air combat had a number of issues in it in V9, the biggest one being that units were able to instantly turn at their maximum rotation rate. In X1 it takes a Condor interceptor 3 seconds to start turning at maximum speed, and it's even longer for the UFOs - which gives combat a nicer feel where units don't instantly react to your units flying past, they're more like boats that take a bit of time to start turning. The other issue was the AI pathfinding not slowing down the UFOs when it would be beneficial to do so ... so flying past a fast UFO that had a slow turn speed (like a Scout) would just cause it to endlessly fly extremely quickly in a large circle well beyond weapon range.
This stuff has been fixed up now and the units behave more like they did in X1. Now the combat is working properly I'll take a look at the weapon balancing compared to X1 and see if the UFOs are still overpowered.
Androns: I'll also play the game a little further to balance out when Androns start appearing and see if they are unreasonably tough before V10 comes out, thanks for the heads up.
SMG / Pistol: I'm not averse to making changes but they do need to be distinct from one another and the primary weapons. These are the constraints of the niche that I see:
Neither the pistol or the SMG should do more damage per TU than a Primary weapon would, even once taking the short range bonus into account - this is my concern with making the pistol have a low TU cost to fire and high damage; at point blank range it could be a bit of a monster. You could counterbalance that by giving it a low Accuracy though so it was only effective at short range.
The SMG should be noticeably heavier than the Pistol, but it should be better overall. You should want to take the SMG if you have weight available.
Having the pistol have 7-8 shots per clip but lighter clips is fine by me, and having the SMG be burst only but relatively low damage per shot is also fine - as long as the SMG has higher overall DPS per TU.