Honestly - I don't know the exact formulars. But it sounds plausible that morale damage is not tied to losses. Well, if it was, CAV would obviously own INF all the way. So, forget about my statement and trust wiki!!
I was a "all-CAV" proponent, basicly since vanilla, but FINALLY, combined (or mixed) arms has become REALLY useful.
Well.. Your explanation and the wiki isn't contradicting. They can be used together. At least with my interpretation of your answer.
We know that casualties change depending on how many soldiers there is in the regiments. Or don't we? I have always assumed that at least.. The wiki doesn't say anything about it but it seems very logical if half as many soldiers would deal half the damage..
And if casualties work that way it would be quite reasonable to expect morale damage to work in the same way. So cav kills more soldiers making the opponent deal less morale damage. But even if we knew how understrength regiments acts morale wise it would be very hard to calculate the turning point for when inf gets the upper hand to cav since it would change all through the battle...
I guess we just have to wait until someone really studies the battles and get a perfectly balanced one at the right time in history to really know.
And I'm not quite as fond of the change as you are.. It seems they have just made the perfect army composition take on different numbers. Instead of only cav it's now only inf with 2 cav. Regardless of what you are doing and where. I would like if it was more a strategic/tactic choice instead of a no brainer..