Agreed it’s a challenge, but it’s only BAD if you go into every encounter like you were playing XCOM.
Let’s take your example and game the system as it stands: instead of firing all 4 men at the aliens (and getting shot at 9 times in return), try positioning your Heavy so that (s)he can lob a missile at the 2 most dangerous aliens from a position which is out of LoS. At the same time, position your Assaults so that they get RF on the aliens when they fire.
Boom! 2 Aliens are down to 2 or 3 life points and bleeding out, and their RF bounces off the wall your Heavy is hiding behind. Bang! Bang! One of those aliens goes down from the RF of your Assaults.
Now your Assaults get to move. If you can, position each so that they get LoS on a target that’s not going to bleed out but are screened from as many of the remaining aliens as possible. Bang! 1 hit on an alien which RFs then gets hit again by the RF from your other Assault. Assault 1 Exerts to fire again and Alien 2 goes down.
Assault 2 now Exerts to get LoS on the next target and blows all of his/her APs doing it. No Problem, you’ve got a Tech, who Rallies. Suddenly, all of your Assaults, PLUS your Heavy have their APs back.
Position Assault 1 to get RF on the next target. If you can, move the Heavy forward to engage it - (s)he’s probably too far away, so takes up a firing position where (s)he can Overwatch on any surviving Alien that moves forward.
Now your Assaults can either Fire & Exert to take out the next target then go into Overwatch, or if that’s too dangerous, put themselves in a position where they can OW/RF vs any Alien that moves forward.
End Turn. One Alien bleeds out, the next gets hit by the crossfire from 3 OWs.
The only issue you might have is if this is early in the mission and you’ve teleported into a killing ground surrounded by Crabbies with machineguns. At that point, DON’T SHOOT! Head for the best cover on ONE SIDE OF THE BATTLEFIELD and go into Overwatch, or explosive overkill on any Crabbies on the side you’ve chosen to shelter in. That way, your OW dudes get first shot at any Crabbie that moves towards you, targeting him out in the open. Your only real problem is if they’re armed with MG+GL, at which point you probably need to spread some high explosive love around and take the hits to take out the Grenade Launchers before they nerf you.
Personally, I don’t think the game is OP in favour of the Aliens right now. It’s balanced WAY in favour of the Squaddies, especially if they have multiple Firecats and Missile Launchers (to the extent that I’ve started house-ruling limits on how I’m allowed to use these).