How was air to air kills calculated during WW1?

In ROF it seems that only airplane kills count in the totals, at least during the career mode only airplane kills seems to count in the aces list in the newspaper.

But as I understand it when I read a book like Rickenbackers: fighting the flying circus it seems to me that balloon kills also counted toward becoming an ace? So what is correct?

They should since they really did in WWI.

In the real war balloons, as they eyes of the infantry, were highly valuable and well protected targets. They usually had AAA artillery zeroed in on the approaches, MGs ready and waiting, and often a top cover waiting. To kill one you had to dive on it through the AAA and then survive the fighters above bouncing you. No easy task.

I guess that would be something that 777 have to change at some point then

In reality there was probably much more protection available to the average balloon than the game engine and our processors could comfortably support. Added to that the ability to haul them down at the first sign of trouble. Their level of difficulty is currently not much more challenging than a parked truck, so it is probably fine to keep them as they are, reward-wise at the moment. One might take heart that no other sim can top it at the moment anyway, but look forward to the future when more complex behaviour becomes technically practical.

Putting alot more/more accurate AAA around them would be a quick fix to make baloons deadlier . . . balloons should count as "kills," right now they don't, and right now they are too easy.

If balloons did not count, Frank Luke would not have been an ace as 14 of his 18 kills where balloons, something his contemporary air men obviously though was even better than shooting down 18 planes (as attacking balloons was considered suicide with all the AA around them). From wikipedia (where Rickenbacker seems to want to emphasize that 10 of his kills where balloons):

Eddie Rickenbacker said of Luke: "He was the most daring aviator and greatest fighter pilot of the entire war. His life is one of the brightest glories of our Air Service. He went on a rampage and shot down fourteen enemy aircraft, including ten balloons, in eight days. No other ace, even the dreaded Richthofen, had ever come close to that."