A role change for Penals seems more urgent than a Conscript buff, yes. Penals need to either be effective short ranged or long ranged infantry. This crap of putting SVT40s alongside flamethrower makes no sense.
Penals are needed at the early game. As conscripts do fine at short-range, penals should be useful at mid-long range. If needed, remove the flamethrower and give them any other cheap ability.
That should fix soviet early game infantry issues.
But still there should be a reason to keep conscripts alive at midgame and onwards. I think that decreasing their
reinforce cost once T3/T4 has been built will make them still useful as cannonfodder, reinforcing units and AT support.
I don't think that this could break the game balance, as conscripst's stats will keep being the same and their AI/AT capabilities so late in the game are not to be afraid even if spammed.