Cons have (imo) the most utility in the game. Even more than riflemen.
They can
1 build sandbags
2 sprint
3 molotovs to clear buildings and cover
4 AT nades
5 merge
6 repair (doctrinal)
7 immunity to suppression (HTD doctrinal)
8 6 models per squad which makes recrewing weapons very easy
9 Upgraded with ppshs
10 spammed with soviet infantry recycle-o-matic (doctrinal)
While their DPS is similar to normal grens so they can't really compete with other axis elite infantry. Does this mean they need DPS buff? No, use penals for the AI. They are getting their well deserved buff.
Combined arms is promoted, blobbing is not. Use cons to their full utility and you'll see they are in a good spot
The most utility? Yea great, let's go at your points:
1. Sanbags are not exclusive for Cons. Volks can build bags, Tommies can build bags and undoctrinal trenches. So, that's not their plus.
2. Sprint. Useful. Agree. Still, don't add real firepower to them, though.
3. Molotovs clear your Cons squads more often, than enemies. They should be too close to target and throw too slow - your squad sometimes can die right after they thrown grenade, or even before it! Compared with Volksnades Molotovs are really bad.
4. AT-nades are also not exclusive. There are also Panzerfausts. Grens are "utility" too after that? But at least they are combat-reliable.
5. Merge. Okay, I don't use it at all, maybe it's useful, I can't see anything really good in that ability and I never had situation, when that ability could make something better on battlefield. And people, whom I play against, also don't use it often. It reminds me flaremines - you can say "they have such a good sight ability". It's good only in theory - on practice, it's out of usage at all.
6. Repair. As you said - doctrinal. Doctrinal benefits are out of discussion. I anyway can use non-doc engineers for same purpouses in any moment.
7. Hit the Dirt is one of the most useless abilties in game. Seriously, mention it as "strength" of Cons... maybe you will also say, that "you know what? they can actually shoot! see, they are cool!". Don't be ridiculous, please.
8. Recrewing is good. What about direct combat abilites, which I mentioned in OP? 2 additional unaccurate and slow-shooting rifles doesn't make it better at all, specially with high target size stat.
9. Lol, and other infantry squads can be also equiped with additional weapons! But you know what? They don't need to take shitty doctrines for to get it! So yea, PPSHs are great, but not when I have to refuse from different REALLY useful doctrinal units/abilites for to have it.
10. Recycle-o-matic spam is also doctrinal, as you said. Putted in pretty bad doctrines mostly, again. That's not "strength" side of Cons at all.
And their DPS is horrible! Random low accuracy, incredibly low rate of fire! And they die really fast in combat, because target size allows to kill them pretty fast. So they really should get either survivability boost or firepower buff, like non-doc additional weapons or T3-T4 upgrade, which changes their useless Mosins to SVTs.
Using Penals as main combat infantry? Fine, then let grenade upgrades affect not only Cons, but also Penals. Otherwise - you just making USSR's game more difficult with no reason. Why should I use "combine arms" infantry units for to do same job, that Ostheer Grens can do alone - support with abilites and kill enemy infantry. And Riflemans are able to do it alone.
That idea of "cons-utility, penals-combat" doesn't improve USSR as faction, it gives them nothing more, than additional headache, additional needance of micro more squads and making Soviet gameplay is more horrible, than it is right now. And it is pretty poor right now, with obvious "doctrinal addiciton" and absence of any possbile deffensive gameplay. Don't cripple soviets more, than they are, please!