Even though I don’t like house rules in general, I like the OP house rule in conjunction with the HR that allows submerging after one round against DD. The first HR makes subs a little weaker (can’t be used as fodder against planes) while the second makes them stronger (by letting them survive more battles). All in all, I think it balances out. It also has the advantage of being elegant and easy to use.
Glad you see it that way.
A still more simplified HR could be that keeping all OOB DDs rules with Subs and planes, each sides which have Destroyers must say whether or not Subs will be targeted in priority by planes.
If not, then anything but subs must be selected as planes casualties (unless their is nothing else except transports) by the owning player.