Ok, I've been giving this some thought, and I've got a few ideas that might help fix a couple of conundrums in the game, both in terms of the game's beginning, and in terms of the game's ending.
"If an entire city is devastated then the world(probably at least 10 billion people right?) isn't going to just sit around watching it happen. Action would be immediate from every nation and they would all take some serious precautions."
Alright, here's what I got on this subject:
First of all, action is being taken by each specific nation, and not just in terms of simply mouthing platitudes and secretly funding PHALANX. In point of fact, PHALANX is only part of Earth's efforts to fight back, but it is the only truly international component--every single armed service on the planet is put on notice of the threat, and efforts are being taken to expand each nation's armed forces and to update their training, their equipment, and their tactical doctrines so as to better combat the alien menace. In short, this is what the Excalibur project is all about--it is the UN's public effort to make sure that all member nations are equipped with the very best weapons known to enable all of Earth's armed forces to effectively combat the alien menace.
In addition to all of this, however, PHALANX has been formed to provide Earth with a) a truly international force with the authority to cross any borders on the planet WITHOUT causing a diplomatic incident, and to provide an international force tasked with finding and neutralizing the alien menace at its source (more on this in a bit).
In short, the world governments aren't just mouthing platitudes--they're actually doing something. This is why the terror strikes throughout the game are always such small-scale operations. Because the local military forces are taking care of the larger scale incursions, PHALANX is able to concentrate on smaller attacks, thus hopefully giving humans the ability to engage the aliens on roughly equivalent terms, hopefully in a setting favorable to human weapons and tactics, where the aliens' superior technology and weaponry will act as much less of a force multiplier. The world governments are, in essence, using PHALANX as a sort of international laboratory and response force, which means that each government is free to focus on finding the very best way to protect its own citizens, without having to worry as much about how their neighbors will be attempting this task.
Secondly, PHALANX's existence isn't being kept secret out of a desire to make sure that Earth's citizens can't sabotage the effort. PHALANX is, eventually, intended to be mankind's offensive arm in humanity's first interplanetary/interstellar war, and experience has taught everybody on earth that striking a truly decisive blow in the face of this degree of technological superiority will require making sure that both the intention, and the ability to attack are kept secret until the aliens cannot possibly stop it (preferably because it has just blown up their planet).
This, in turn, leads to my recommendation for how to end UFO: Alien Invasion--not with a single strike to one, localized brain pod unit like is seen in the X-COM games (which has always struck me as supremely unrealistic), but instead a potent demonstration that, if this war continues, humanity can and will annihilate the aliens once and for all.
The final mission, in the preliminary sketch I've come up with, is not "take out the alien brain creature" mission, but instead a mission against numerous, if disorient survivors guarding a significant store of alien anti-matter. If the final mission can retrieve enough anti-matter, and display the ability to destroy entire planets (or, at least, their biosphere and/or surface) at will, then the aliens will have only two options: destroy Earth outright, immediately, in hopes that the humans have not based their weapon outside the planet's orbit, or to sue for peace (preferably with the threat of mutual destruction to hold over humanity's head).
This will also fit in better with the group-mind tendencies displayed by the aliens throughout the game. No group mind that requires a certain number of individuals to pass the threshold into awareness is going to be located in a single facility for PHALANX to take out with a surgical strike. Instead, it is much more likely for a group-mind to be spread out over the surface of one or more entire planets, creating a massive, dispersed intelligence which is more than capable of surviving any single precision strike. Humanity, being much less advanced than the aliens, cannot realistically use a precision strike to bring down any alien command center anyway--so PHALANX resorts to the brute-force deployment of WMDs (probably kinetic in nature) to simply destroy an entire planet, wiping out any trace of the alien hive mind, alien technology, or, by and large, any trace that life every existed or could have existed on the planet's surface.
I also would suspect that the aliens' initial attacks are not only not really repeatable, for several reasons, but also not really something the aliens ever had any intention of repeating. Or, if they did plan to repeat the attacks, it was not until much, much later in their invasion timetable, after the XIV had made much of the world into the aliens' playthings, and softened up the remaining centers of resistance considerably.
I suspect the attacks to be unrepeatable (or at least not something that can be safely repeated) for several reasons. First of all, after the aliens were able to achieve such success over the worlds' military organizations, the whole world would have begun to essentially fortify itself against the aliens...and, as the game itself points out, even if human SAMs can only get a 1% hit ratio against the alien craft, enough missile launchers can and will damage alien craft. While not all, or even most damage alien ships will be beyond the ability of alien troops to recover, some would be, and if the aliens have put in as much effort as they have to make sure that they leave no trace of their advanced technology, then I doubt they'd be willing to risk humans simply shooting down an alien craft and getting that technology the easy way. I would also, at this point, speculate as to whether the aliens CAN repeat that scale of attack at all, at least for the next several months. If the frequency of the aliens' attacks is any indication, the aliens most likely have an extremely limited ability to transport attack ships into our solar system, possibly because the FTL drives the aliens use are beyond even their ability to make, or even understand, quickly and easily. This would also explain why they would ever be willing to leave humans alone for any length of time--if they can be absolutely positive that humans cannot replicate their FTL drives at any time in the next hundred years at least, the game's end can be explained as the aliens simply either buying time, or just retreating beyond humanity's ability to follow. Thus, if they were to mass their entire FTL carrier fleet for the initial quartet of attacks, they could land enough troops to engage in a major landing...but after that, the demands of an interstellar empire would like require that they pull carriers off of the attack, and dedicate them instead to more routine tasks.
The second reason, of course, is that the aliens do not want to carry out such large scale attacks--it is not part of their strategy, to put it bluntly. The aliens' initial attack, against Mumbai, was in fact a massive harvesting operation. The aliens' plan was to use the attack to gather enough humans, both dead and alive, so as to be able to first adapt the XIV to humans, and then to provide sufficient culture mediums to allow the virus to grow (this is where the blood in the first Corrupter ships comes from, if you were wondering). Unfortunately, the Commonwealth's forces were quite simply too well armed, too well trained, and too prompt in their response. The mission was a failure, and the aliens could not gather sufficient human material despite their best efforts. Indeed, so ferocious was the Commonwealth resistance that the aliens were forced to dump many of the human bodies and organic components to make room for their own dead (many of whom were probably later revived, or simply salvaged for parts), and their own lost equipment. I would not, by the way, make the initial alien incursions the product of "small" UFOs, as six small UFOs, no matter how well-armed and armored their inhabitants, or even how well coordinated their troops, would not be able to take out upwards of three thousand well-trained and well-armed soldiers...particularly not in light of the fact that the Commonwealth's weapons are, by and large, the most effective against the aliens.
If y'all go for this, then this is probably how the results of those attacks looked from the alien perspective:
The Mumbai attack, which the humans saw as absolutely devastating, was in fact a failure--not only did the aliens not obtain sufficient specimens (and organic material) to carry out the next phase in their invasion plans, but they also expended considerable resources in the process and managed to alert what was clearly a powerful and well-organized foe as to their existence and their eventual designs on Earth. Later attacks, carried out against Bonn and Johannesburg, were similarly unsuccessful--not only did they inflict far too much damage on what was increasingly clearly an infrastructure the aliens would want to preserve, but they also failed to gather the necessary materials for the adaptation of the XIV to the human species. Despite increasingly large forces, with increasingly large casualties planned for, the aliens were, each time, forced to retreat with their holds mainly full of their own dead in an effort to deny humanity any kind of forensic evidence of the aliens, their intentions, or their technology. For all the damage done, and all the casualties suffered by human forces, the aliens regard these two missions as at least partial failures, and with good reason.
The attack on Bangkok, however, was an entirely different kettle of fish. Previous attacks had been made against enemies which were either totally unprepared, or at the very least tactically unprepared for the speed, ferocity, or general technology displayed by their opponents. Bangkok, however, had already seen one strike landed nearby, and, with the Excalibur project already beginning, had begun to seriously upgrade nearby military units...including its anti-aircraft abilities. When the aliens attacked, they intended to head directly for the city center, home to the largest concentration of humanity in the area. The terror provoked would, it was hoped, cause the nearby humans to flee, thereby delaying any significant military response as hysterical civilians simply trampled everything in their path (a baffling human tendency which the aliens had noted on their previous attacks). Unfortunately, heavy local anti-aircraft fire prevented this, forcing the aliens to land even farther out in the city's suburbs than had previously been the case. Here the aliens ran into not only local military units, but armed civilians, who, though unorganized, were nonetheless able to slow reclamation efforts immensely. This, combined with a vigorous and immediate response from local forces, was able to force the aliens to retreat, allowing virtually no time for specimen retrieval, and nearly forcing the aliens to abandon some of their dead. Despite heavy damage and severe casualties, the aliens accomplished none of their objectives in the Bangkok attack. Hence the decision to rely upon smaller, more isolated attacks--it is a deliberate effort to isolate one or two humans at a time, rather than slamming headlong into hundreds of thousands of humans at a time.
Now, as for the aliens suddenly becoming stupid...don't change that. Remember that the aliens get smarter as there are more and more of them. They recognize changing situations better, they can come up with better solutions, and so forth and so on. So far, we're seeing attacks of between three and seven aliens. In other words, if PHALANX operatives can hit them fast enough, hard enough, the aliens have no time to react, and are essentially caught outside of their pre-programmed response set. Most of the existing response set is taken up with actually manipulating the aliens in their various tactical evolutions, so there's literally no room for an entire set of "retreat if" commands to be implanted. Once the player starts running into larger raids, this can become more of an issue, but even then, PHANLANX is still operating with an enormous advantage in terms of both general experience, and in terms of over-all coordination. In essence, the distance from the aliens' home world(s) means that each new attack is conducted using essentially green troops. The local hive minds in the larger raids was capable of learning, and learning quickly, and data from any fleeing aliens can rapidly be shared among the aliens' main hive minds, but on Earth, PHALANX operatives have the advantage in terms of both general experience, and training.
