Honestly, I would be fine if friendly ships died as a result of aggressive actions that actually meant something. We're fighting battles here, it's not realistic to expect every engagement to result in a full sweep with 0 casualties. What's frustrating is when the AI dies because they are acting stupid and treating my orders as "suggestions". When I say "eliminate", they should do so. When I say "retreat" or "avoid", they better listen, and not dawdle around. 99% of the time when ships die it's because they are just acting dumb, and this kind of "durr" behavior usually cascades into total annihilation because at a critical moment one of them wimped out instead of taking one for the team. It's very frustrating to see something like this happen and watch as your entire fleet is slowly eviscerated, because there's nothing you can do to stop it, because they won't listen.
tl;dr the default behavior is ok-ish, but I would like to be able to influence their behavior in a stronger way. That way I'm the one who makes the decision that can get a ship killed, which keeps the AI from being responsible for that kind of thing, and also allows me to exploit situations I see that the AI cannot feasibly be smart enough to take advantage of.