Early protected cruisers can be surprisingly well-gunned, too - 4x 8" isn't a bad battery for 1900, and it can do some damage even to heavier ships.
Except perhaps for the top-end CLs - the ~7,000-8,000t CLs that are more smallish first class cruisers with a heavy emphasis on firepower over armor protection than the second or third class cruisers that the CL type mostly represents - my feeling is that the 2x2x8" protected cruiser CLs really only come into their own in the late '00s or early '10s. You need at least Central Firing to really take advantage of the 8" gun's range advantage over 6" guns, you need a bit more armor penetration than the 8" gun has early on for it to do much better against CA belt or B extended belt armor than 6" guns would, and you need to be facing CLs that have actual armor belts before armor penetration really starts to matter against them.
Another reason why I do not used larger CAs is that they cost about 60M which is too expensive.
You can build cheap BC for about 90-110M which can have speed of CA (30-31 knots), have 6x15" guns and have armour enough to have even some immunity zone against heavy guns (or using magazine box have magazine box protection as battleship and rest enough against CAs). This ship is much more versatile than CA and does not costs too much compared to CA.
Relating to heavy cruisers I am thinking if they are really worth it as powerful heavy cruiser costs about 60 M. But for just 83M in 1936 you can get really fast battlecruiser with 15" guns and have turret protection even against 16" guns with small margin. And have magazine protection against heavy guns, rest against medium guns.
It seems to me that heavy cruiser have not chance against such ship at good weather and in bad weather light cruisers are better as they are more expendable. In good weather this ship can even suplement battlecruisers because of her 15" guns and some limited armour.
If there is will to spend 110M, you can get full protection even for rest of citadel and increased deck armour to 4.5" and still speed of 31 knots.
My limited experience (nearing the end of my second playthrough) suggests that having ships in smaller classes is important for battle generation. Even if you think your battlecruiser is just an optimized heavy cruiser, the game will still spawn battles where you might get to use a CA but won't get to field a BC. If you don't have a CA, you may wind up facing enemy CAs with only CL or DD forces.
I think the strength of CAs is that the game is happy to pit them against enemy CLs and a lot of the AI BC designs use very thin armour.
They are otherwise hugely expensive.
Issue is that heavy cruisers have not enough penetration against AI designs from 20s which have at least 10" of belt armour, usually about 12" of belt armour. Even in 40s penetration ability of 10" Q1 guns are about 10" of belt armour at 5000 yards.
The only issue I have with it (and Britain is one of my favourite nations to play, just because they have to juggle the various requirements - being in a war vs the US plus one of the European powers can be quite hairy, but there's also a big enough budget to have fun trying out some interesting designs) is that it's pretty obtuse in-game how to work out how the tonnage works for foreign stations (I basically fired up a new game and did a bunch of test builds, put various costs and the foreign stations tonnage they counted for into a spreadsheet, and worked it out from there - as an aside, the absolutely cheapest way to do it is to build 1700 ton KEs with colonial station ticked, but after doing that for about a third of my FS tonnage for one game and finding it a bit much micro for me, I'm now onto 6000 ton or so CLs with colonial station ticked).
Perhaps if, in the ship designer and/or data sheet, there was a read on how much colonial stations tonnage a design contributed? That way, it'd be obvious when building, and people can always bring up the design and/or data sheet to see how much a ship would contribute to CS in any area (doing the calculations for FS on the fly for anything over 6,000 tons gets beyond my 'casual maths' capacity very quickly).
It also means that for a not-really-finickity-to-manage Britain game, it's pretty important to do a manual build of the legacy fleet, but the in-game ship design is something I enjoy a lot, so that's not exactly a bad thing for me .
Regarding thoughts that early CL are poor, I find that a protected cruiser loaded full of 6" guns can be very powerful and only moderately pricey, in the 6000 t range. In the most of my wars those early game cruisers are the linchpin in winning early game wars.