The only reason airpower didnt work as you mention in Korea and in the current situation is because of political constraints. If America were unlease her full fury, we could wipe the floor with our air, killing millions of people indiscriminently.
As far as people saying its unbalenced...I want a game that models reality more then a balenced game that says my steath bombers can sink a trireme, or whipe out a warrior, or for that matter, kill workers. Give me a break!
I want 3 levels of airpower tech, the first level aircraft shouldnt be that effective, that way its not a rush to airpower, the 2nd level, ww2 or cold war type units, should be more effective, but they should require you to go through other techs that allow ground/navies to develop. The 3rd level should come at the very end of the game, and it should be absolutely devestating.
That being said, there should be good counters available too at each level, but if you don't have the tech to stop stealth aircraft from carpet bombing your cities, your out of luck, just like in real life. That being said, steath aircraft that have that capability should be extrememly expensive, just like in real life, that way, its is very expensive and takes a long time to aquire such aircraft, again just like in real life.
While on the subject, I should be able to carpet bomb my enemies cities and whipe out the population, or tgt the city improvements, like in real life. If a civ kills too many civilians though, other civs might get unhappy with their gov't if it doesnt stop trading with the bombing civ. There are lots of cool political ins and outs you could have.
Bottem line though is: the third level of airpower should be overwhelming, so much so that countries cant afford to have huge airforces composed of such aircraft. Also, there should be good defenses available, but only at the tech level of the aircraft type. I will be pissed if my stealth aircraft are getting shot down by an inferier enemy. Nothing ticks me off more then stupid crap like that.
Just thought of this while typing, perhaps there could be an anti-aircraft upgrade that could be added onto units. That way you could upgrade units to be effective at damageing attacking a/c. People would then have an incentive to upgade at least 1 of their units in a stack with anti-air capability. The upgrade could be allowed to all rifle bearing units when at least 1 civ in the world has discovered flight. Conversly, the upgrade could become available with physics.
Example, there could be 5 levels of "AAA" upgrade. Each level adds a 10% chance that damage will be done to the attacking aircraft. Note, that I believe when aircraft attack a ground unit, it shouldnt be an attacker wins vs the defender wins scenario. Both should be able to attack and damage each other on the same pass. When 1000s of bombers were being launched on germany in WW2, the bombers all took damage, and so did the target. Back to the "AAA" upgrade though, 10% chance at the first 4 upgrades, and then the 5th one could be 25% chance. Having such upgrades would help negate the power of aircraft.