So I made mods to gameconfig.xml : I reduced the cost of a new base, increased the size of quarters and changed the aircraft turnaround time to something I think faintly sensible -- I moved refueling time to .75 and dropped rearm time to 45 min. Now, when I hit engage in Air Combat the game refuses to unpause no matter how much I hit the space bar. Which clearly works otherwise...
(There were some other changes as well: I changed the weapons and vehicle weapons files a bit: I dropped the burst fire TU values, as well as the LMG-types so as to stop breaking my suspension of disbelief and likewise increased the accuracy a smidge: I know for sure that it takes better shooting that that to simply get through basic; I can't help but feel that professional SF types --who have to complete a far more demanding practical shooting course -- should be even better shots than I had to be to fly helicopters.
Additionally, I reduced some costs for researchers, soldiers and and engineers and upped the engineers per workshop values. I don't think those would cause this problem, but what do I know?)