Stop letting them get in 6 inch range? Supression and reactions are the key to this game. Axis can supress and outrange a good deal of units pretty easily.
They're an annoyance, not a major force. You know, flankers and scouts? Point-filler. And that extra 4 dice can be useful; they can pin a much larger and more dangerous unit, while taking little but suppression in response.
I have to agree that the observers serve little purpose. The only effective use I've found for any of the observer teams is joining a Soldeir 2 command section hero to them to give the hero Team and a pair of radios. Beyond that, they are not of much use and the points are often spent better elsewhere. I think the main reason for their lack of purpose is that any Artillery weapon can direct fire with a range of 36" and make a Sustained attack. It isn't that hard to get LOS to your target which is all the observer team provides.
I feel your pain Warboss - I too play in a campaign against the SSU. My opponent however likes to field Winter Child - so any of my S2 units take a beating. He just finally figured out how to make him deadly effective - he's like a flying harasser. At first I threw a ton of energy into attempting to take down the SSU force - but now I have to simply rely on an overall strategy of beating him via the misison parameters. I still have to apply some tactical shifts to my plans - meaning I cannot afford to lose too many units - but sometimes a group of zombies makes for an oustanding piece of bait. As an axis player I have learned NOT to sit idley by. I'm not even sure how to play the axis as a defense team - save for adding dig in. Angela is your friend - so are your snipers. Blutzkrieg will get you as close as you need to be to soften him up. I have used Hans in the past - but I'm trying out some new options. One option I did a while back was take Manfred as CO + a beobachter - thus two radio commands + weiber serum (you MUST make yourself remember to use it). Heavy Flak Grenadiers - are amazing. You only have to use the burst feature IF they are in cover - if not - light him up. It's 9 dice - all you are looking for is suppression - not a table wipe. Also - if your opponent isn't too "cheeky", meaning he's stacked his campaign with heavy armor or WC, use Heinrich against his guys. That's another 30" range vehicle. Again - he can help keep the suppression on.
Here's a couple of the campaign playtest armies I used - I have included the outcomes best of memory.
Key Positions - Snow -
Dust Warfare - Force Builder Faction: Axis ( 150 / 150 )
--- Heroes Manfred (15) - Survived
Upgrade: Improved Command (5)
Command Section: Kommandotrupp (25) - Survived
1st Section: Heavy Flak Grenadiers (26) - Survived
3rd Section: Laser-Jagdgrenadiere (25) - Survived
4th Section: Recon Grenadiers (17) - Dead as hell
Support: LPW I-C "Hans" (25) - Destroyed
Support: Sniper Grenadier Team (12) - Survived
Outcome: Mission won with moderate losses.
Symbolic victory, unpreparred, none
Dust Warfare - Force Builder Faction: Axis ( 150 / 150 ) --- Sturmgrenadiere Platoon (150) Upgrade: Extra Panzer Support (10) Command Section: Manfred (15, Hero) - Survived 1st Section: Heavy Flak Grenadiers (26) - Survived 2nd Section: Axis Gorillas (24) - Dead 3rd Section: Battle Grenadiers (17) - Dead Support: Beobachter Team (8) - Dead Support: MPW III-A "Wotan" (50) - Survived
Outcome: Win with severe casualties
I am undefeated against my SSU opponent in 300 pt games - and although I won these two - the casualites versus the AP recovery cost hurt. I lost my patrol game embarrassingly when he deployed a chopper (the anti troop one) on my side of the table and within round 2 command phase had taken out my VIP - which was as schwer platoon. I had NO way of beating him as his command AP was only 25 - so I had to eat a very humbling patrol loss. I say that to mean - You CAN do it - just don't let him walk up on you. Do your best to balance your mission objectives without losing sight of your forces. If you're in a pinch - call a fallback - discretion is the better part of valor.