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I love microing all my divisions, it makes me feel more in charge. I use theater AI for theaters that don't require my attention, I also use it for peacekeeping on conquered territories.
In my Soviet game using DiDay's ICE, I use AI-control for my NKVD brigades, and when any one theatre is a foregone conclusion. Like the last days of the invasion of Sweden. God knows I didn't want to do that manually, they had only 1 division to face me with!
Mostly, though, I have my own layered defense that I want to coordinate myself.
I use the AI only during peacetime, it helps fill up the army HQs and construct a full chain of command. When war starts though I start to micromanage all of my troops. Though it hurts if im fighting on multiple fronts. I can normally use the AI during peace but when playing Germany, I always have the inactive HQ under AI control because they aren't needed in combat but just to prepare for a war. And the AI only is decent at guessing what it will need.