Oh definitely, I feel like the AI is currently the weakest part of Starsector, hands down. It's basically something that you have to learn how to work around. I would happily take an update that is nothing but improving the AI and making it more responsive and intuitive, over new content per se. But working on refining the AI isn't "sexy" so the current AI basically soldiers on. Basically all new players have to get used to the AI doing completely unintuitive and stupid things and learn how to work around that, to make their fleet so strong that even if the AI makes a bunch of mistakes, it'll still win.
Fortunately, as Alex has directly said, the enemy AI is identical to the player's fleet, even down to having an admiral who's sitting there looking at the entire battle map and issuing commands to the ships, limited by the same command points that the player is limited to. So if you're playing a strong player flagship like an Onslaught or a Ziggurat, and you're feeling like the enemy ships just walk into you and die, well, that's because your fleet does the same thing to them. It goes both ways. So you might want to be careful about asking for better AI; better AI may very well make the game harder as the enemy fleet uses better tactics against you.
The only commands I've found to work consistently are "Avoid" and "Retreat". You should see everything else as general guidelines or objectives for your ships to follow, with no particular urgency nor commitment on their part:
"Capture Objective": You might intuitively think that this means the ship(s) will make a beeline to the objective, and then stay within proximity of it to take control of it, unless forced off by enemy ships. What you will actually get is that even if you send an entire fleet of Furies to capture an objective, they will stay a respectful 2000 su away from a lone enemy frigate capturing the objective while they ponder whether or not 8 Furies is enough to handle one enemy frigate, then they'll slowly mosey in after the enemy frigate captures the objective and starts heading away. Or they'll be there until they see another enemy ship at which point they'll decide that chasing after the enemy ship is more important than waiting until the objective is done being captured.
"Eliminate": You might intuitively think that this means the ship(s) will do its utmost to put all its weapons on the target that you selected. Nope, it'll continue with what it's doing, not even bothering to start moving toward the target until it's ready, and possibly firing on other ships even when the target is in weapons range. What this *will* do however is make your ship ignore that it's under attack from other ships, so you need to be careful about using this if there are other enemy ships around. Sometimes the "Eliminate" order will also make your ships back off, which actually makes the situation worse (for example, if you ordered some backline ships to "Eliminate" an enemy ship because a forward ship is getting pummeled, and then you get to watch the backline ships actually back off; or you order your ship to "Eliminate" an enemy frigate before it gets away, then you watch it head directly away from said enemy frigate). That is supposed to be one of the bugs to be fixed in the next update, so hope it'll be addressed.
"Defend": You might intuitively think that this means you're telling the fleet to go to a particular high-value location and prevent enemy ships from getting to it. What you'll actually get is your ships may decide 1) there's some enemy frigate it would rather chase halfway across the map, even if you gave directly gave it a defend order to a location, or 2) your ships will decide to back off when enemy ships approach that defend point, courteously moving to the side so that the enemy ships can slip through. Unfortunately you have no control over which choice your ships may make.
Having said that, "Defend" is useful for getting your fleet to spread out in roughly a line at the beginning of combat. If you take your fleet and give them a "Defend" order behind the enemy fleet, they'll naturally spread out into a line as they try to pass by the enemy fleet without disturbing it too much. Then you can cancel the "Defend" order and they'll start attacking. So there's that.
The AI doesn't really know how to be at the proper weapon range, nor how to adjust its aggression based on its current flux levels. You might intuitively think that low flux means close in and high flux means back off, but you'll find plenty of examples of high-flux ships next to the enemy continuing to head in (maybe because they're trying to kill off a target or because they decided to commit to the fight), while low-flux ships behind them are staying back, unsure if they should move in (maybe because they see missiles on the way or because they're afraid of whatever enemy ship the forward ship is next to). You might think that overloaded ships should back off, but nope, a lot of times overloaded ships will decide to just keep going forward toward the enemy while still under full maneuvering control.
The AI also doesn't know how to move around each other. Say you have a high-flux ship to the upper left and a low-flux ship to the lower right. For us, it's intuitive that the high-flux ship just needs to move to the left a bit and then it can back off, while the low-flux ship just needs to move to the right a bit and then it can head in. What you'll actually get though is both of them will be stuck against each other; the high-flux ship doesn't want to risk colliding with the low-flux ship so it won't back off, while the low-flux ship doesn't know how to go around the high-flux ship so it'll stay there and block the high-flux ship from backing off. So the result is that the high-flux ship will eventually get overloaded and die, while the low-flux ship hangs back at low flux and doesn't fire a thing.
The AI doesn't have any sense of a formation. Not just in the traditional RTS sense, but also, in that if you have a friendly ship in front of you, then it's safer to move in, while if you're the only ship in the front, then maybe you should wait for the others to catch up, or have a lower flux threshold for backing off. There also isn't a generalized "attack move" command, meaning to move in this general direction and attack anything you come across, so it's hard to force the AI to move forward when it's hanging back. You can try to use an "Eliminate" command to do that, but then it'll just ignore anything else, including if that target moves behind other ships, so you have to watch it carefully.
The AI also over-prioritizes missiles that aren't a threat. This means it'll face its shields toward Proximity Charges that are far away and ignore the incoming fire from the ship next to it. This also means that backline ships will refuse to head in if there are any missiles in front of them, even if they're at zero flux and the missiles are just some gimpy Pilums or something.
I think it's not a coincidence that the most effective ships I've found -- measured by how quickly they can kill enemy fleets -- have basically been long-range ships that can equip Squalls. In the same way that your ships don't know how to handle enemy missiles, the enemy fleet also doesn't know how to handle a bunch of missiles being thrown at them from 2500 su away either. The Squalls basically put the enemy fleet in disarray and prevent them from mounting any sort of offense, while the long-range weapons kill them off before they can close in to do any significant damage. This means I don't have to deal with AI issues as much. Gryphons, Conquests, Atlas2's, Legion XIV's, etc. all perform much better than a similar DP's worth of other ships, at least thus far in my testing, because of this. With the Manticore (LP) in the next update getting a Large Missile, I'm looking forward to spamming it in my fleets (depending on its DP cost, of course), since this strategy works even when the ship has SO.
Eventually though you get an intuitive feel for when the AI will act badly, and learn how to avoid getting your fleet into those situations. Or you just learn how to make sure strong ship builds and fleet setups that your fleet will win despite all the AI issues. In the meantime though it's a lot of frustration and yelling at your screen until you figure out how the AI works, or doesn't work.