OK having spent the last couple of hours messing with the ME, I can say with some confidence that by increasing regional activity you are introducing more aircraft, both friendly and enemy, across the whole "map". I can also say that a meaningful number of those aircraft are unlikely to have any contact with your current mission path. Now this may not matter as much early in the war, but in 1918 it could make a significant difference. If it were possible to cull flights that were never likely to intersect with your own, you might in some instances be able to reduce the load by as much as half (early guesstimate). As an example, my system is generally comfortable and smooth up to ~ 150 planes. Beyond that it starts to noticeably bog down. This is not stutters. It's a consistent degradation of the overall smoothness, In 1918 with regional air activity set to medium I often see 300+ planes and it's not super playable. If I could get that down to 150 I'd recover some smoothness and hopefully not miss out too significantly on EA encounters. Make sense? The downside might be that you'd be altering the balance of power in such a way that you might gain an unfair advantage, simply because less friendly flights would be culled due to their proximity...? Not sure about that. I'm also not sure if simply dropping air activity would have the same effect but I am going to guess for now that you'd have more enemy encounters with regional air activity set higher, but with the advantage of less craft in the air overall, hence the idea for the feature. Seems logical, to me anyhow
As for "spawn stutters" I'm still investigating this.