I agree that the M3 may slightly struggle but I think this is primarily due to the way people use them. People need to understand that putting a flame thrower unit inside of the car and drive close to the enemy is a huge risk. This risk can and often does pay off, of course but people need to understand that it isn't the right thing to do in every situation.
I'm sure that when used in conjunction with other units, it does fine: As has been stated in this thread, its DPS is very comparable to the 221's DPS, it costs less etc.
The only reason it has fallen out of FotM is because the SdKfz 222's auto cannon hard counters it and because the buff of AT grenades and the Panzerfaust means the scout cars can no longer luckily survive two of those and will also die faster because it will require nearly 20 shots less to finish it with carbines. However, with guards in it the M3 counters the 222 in itself. So people going T1 will always either have to get guards or have lots of AT grenades around (with a good synergy to Oorah!).
This is the tradeoff you take when going T1: T2 offers staying power and field presence whereas T1 offers high shock potential (M3 flamer, satchel throw) and units that can deal a lot of damage but also need baby sitting (all T1 units).
Considering the M3 should never be hit by a Panzerfaust when used defensively and carefully -like a 221 scout car usually is- its stats and cost are very similar to the 221's stats while also offering additional power/features. The lower fuel cost may be accounted to the cost of the Soviet T1 building and the higher versatility of German T2.
However, I'm still rather curious what and how they change it and I think small changes like a slight armor increase won't make it overpowered in the manner it was a few months back.
I just don't want to see a return to the clown car days (see that comic guy's comic for that).
You can't normally afford to use an M3 defensively, just because the 20 fuel investment means you'll hit Tier 3 or 4 late, leaving you open to a fast Ostwind or P-IV, which you won't have an AT gun to counter. I.e. you need to get some territory control to make up for it, while having 1 less infantry unit early because of the teching cost.
The issue I set out in my post isn't actually the panzerfaust or the scout car (which are fair and reasonable counters and I'm very glad they've been improved) but that it frequently doesn't work as a counter to pgrens (because it just gets focussed down quickly), takes a reasonable amount of damage from HMGs without incendiary rounds or other things it should hard counter on account of the lightish armour of the M3 and fairly high damage of those units. I'd like it to perform a bit better against units without any AV capacity while still having the trouble it does now against real counters to it (or being soft-counterable with grenades if the Soviet player is careless, as it is at the moment).
(On the meta: right now - Ostruppen make tier 1 more or less unviable imo, it's OK but not stellar against grens + MGs, it's alright against assault grens, Scout Cars and Shreks hard counter it, PAKs and vet MGs deny it... i.e. I think there are enough substantial viable counters now that making it a bit better at dealing with pgrens and MGs wouldn't blow the balance).
Nullist, if you're going down that route, the 251 has forward reinforcement (which is obviously a massively powerful ability), far more health (in practical terms, the difference between going down to 1 faust + small arms fire versus taking 3 AT nades is really big) and the double-flamer upgrade, which is extremely strong (and popular). It isn't actually that much more expensive.
If however, you're talking about the 221/2 (I can't really tell, the scout car upgun is only 70 munis rather than 120 btw), it also has a turret and the ability to double as AI/AV with only muni investment. Right now it is extremely useful for the Ostheer, operating as a hard counter to snipers, combat engineers and scout cars and a soft counter to conscripts, shocks, penals and even (with vet) T-70s. I personally suspect it'd get more popular rather than less if the M3 got buffed to be just a little more resilient against small arms fire.
Stats are obviously important but balancing has to consider how a unit actually operates in the context of a real game instead of how two units would operate in a vacuum. Either way, I'm not really talking about whether the M3 is balanced directly compared to the scout car (or the 251) but whether it actually performs adequately in its role (so, against infantry with no specialised AV capability and against lone squads).
@LeWish, you have to spend ages with an engi building tier 1 and then you're down a conscript in the early game thanks to the cost of the building. If you want capping power, I can't see an M3 being a good way to go about it.