Problem(s):
1-Missiles are both overpowered and very min-max-able, energy weapons cannot serve any role but that of the pistol in your boot while you are toting an assault rifle (missiles).
2-Non-square damage numbers are suboptimal for warheads.
3-Despite the engine efficiency bonus given to larger engines, smaller missile remain superior due to their much higher rate of fire and greater difficulty in shooting down.
4-Ships can too easily be designed with massive amounts of armour layers (20+) which make such a ship extremely difficult to destroy.
Discussion:
(1) is not necessarily a problem. The same way that big gun battleships are no longer feasable for naval dominance due to the development of aircraft carriers, the same could be the case for missile ships since these work exactly the same way, they just cut out the middle man (the aircraft). Missiles, of course, have their own weakness in the sense of limited ordinance and ability to be intercepted, but they remain your primary striking arm regardless.
(2) is a problem in the sense that it vastly restricts variety in missile designs. In addition, the 'jumps' between optimal warhead sizes get bigger and bigger as you scale up, exacerbating problem (3). Of course, this is barely noticed, because this problem is completely eclipsed by (3).
(3) is the main problem with missiles. The pros of splitting your missile into as many missiles as you can that each deal 1 damage far outweigh the benefits of leaving your missile as a large monster. Not least of these advantages is greater difficulty in interception and the more rapid rate of fire. It has been argued that the optimal warhead size of a missile is 4, especially at higher tech levels, but that only illustrates the problem. Notice that absolutely nobody builds missiles with warheads of size 81 except for rp reasons.
(4) is not really a problem at present. The main reason being, of course, is because it serves as the only counter to massive numbers of small missiles. Yet that is not optimal as this once again restricts variety. There is very little else you can do to prevent 'sandblasting' and for this very reason it cannot be done away with. Not only is it unrealistic, but NPR's never do the same, leaving them at a significant disadvantage.
Solution:
Bear with me, this is where I seem confusing.
-> Armour becomes (partially) ablative. When damage is done to a ship, the equivalent number of armour boxes aren't immediately destroyed. Instead, the damage is added to a 'damage counter', let's call it 'dmg#'. For each armour box that would be destroyed normally, a check is made. A random number is generated between 0 and 1. If that number is higher than dmg#/(1+dmg#), the armour is not destroyed. If it is lower, the armour is destroyed and the next armour box is checked. Regardless of the outcome, dmg# is reduced by 1. If the armour box is not destroyed, the same armour box must be checked again on the next step.
What the hell?
The effects would be the following (math incoming):
AMMs (size 1 wh) would have a 50% chance of destroying an armour box and thus do 0.5 damage effectively (0.5/wh).
Double size AMMs (size 2 wh) would have an expected damage of 1.16 (0.66 + 0.5). (0.58/wh)
Size 4 wh missile would have an expected damage of 2.71 (0.8 + 0.75 + 0.66 + 0.5). (0.6775/wh)
Note: I've tried posting this in the suggestions thread, but it immediately became spammed back several pages by people who feel terraforming needs to be fixed.