Penals do need a DPS buff so that they totally man handle PGrens at Far range, slightly out DPS them at Mid and lose horribly at Close. Other than that they're fine.
Hmm - I feel the opposite - their DPS is already more than twice a conscript squad - what they need is better survivability to keep that DPS up. In theory they should do ok vs. Pgrens if in heavy cover as their damage will be better at long range and the flamer ignores the Pgren armour and causes them to drop to the ground as they try to close but they are just so fragile for what they cost, it doesn't usually seem to work out in that ideal way.