This game is really easy to mod and there is a very nice mod on net full of new options, harder AI (and dificult levels for it), soldiers really dying and other tweaks to make it more real and chalenging.
But yes, the game as it is on retail release do sux. Not because the game concept sux, but because it seems very badly executed by the game project. You get the impression it was just released in a hurry before it was all tested/tweaked/balanced.
Mods do fix a lot of it though. And game is very mod friendly (Well, I surelly can't code good enough for UFO AI, but I had no problem modding extraterrestrials myself on every little thing. Very simple to handle the game var. and files). Everything from items to game mechanics was very easy to edit.