One thing I've noticed about the civil war that this update doesn't seem to fix is that a lot of the time the borders are on exact state borders. I imagine, especially in a scenario where the Feds abandon territory, the borders would be a lot more chaotic and fluctuating, not the perfect straight lines and set areas of state borders . It's odd, because the problem does seem to be fixed in New York and a bit of West Virginia, but no where else really.
I think this is mostly an engine limitation due to the way that scopes work in relation to events, which means that the clean-cut state lines is probably the best arrangement in regards to overall functionality and overhead.
That said, some of these changes seem rather interesting. I gave the Kaiser-Redux mod (a spin off of KR with more memes, but also some serious tweaks) that has this general arrangement in regards to the fronts going on, and it does make for some serious changes in how the war front is actually waged in the Americas. The difference there is that Redux has more factions in play, so it doesn't translate directly. These new tweaks to the ACW seem to imply that there's probably some adjustments to Canada's interaction with the conflict (particularly in regards to New England) that is probably determined based on what's actually going on in the war, but I'm not necessarily sure of the immediate consequences of the choices. I can imagine that bunkering down in the north east as the US is probably an extremely defensible position, but it does seem to invite some resource problems.
Generally speaking I'd probably go for the Midwest plan, as I've used something vaguely similar as the AUS in a recent multiplayer game. Rather than go north to fight the CSA, I did a precise attack to stop the US from pulling the troops out of the pocket and used them as my meatshield to keep the CSA at bay, then threw absolutely everything I had at the Pacific States. I used the tactic I used to get the 30 Minutes of Hel achievement (create a deliberate weakness in the line to allow the enemy to break through with their fast movers in a controlled way, allowing the entire spearhead to be cut off and destroyed) to eliminate most of the main units of the Pacific States, swept to the coast and had them out very quick, then shifted the frontlines to the Midwest once the immediate situation was secure and I had resources available. The Austro-Hungarian player helped me out a bit here by giving me some lendlease I had to pay them back for later when they knifed Germany in the back at the same time I did the Entente when they thought we were going to bail them out from the International.
Every Man a King indeed