I think is more important to conserve manpower/morale as long as possible. Land is a buffer you can trade for time/manpower/morale.
If your front is short your stronger and therefor its harder to crack the line. Winning as GHC is basicly impossible in most cases, but a draw is likely and in this case 75% more then likely. You do have a shot at a minor win, but once the lines crack SHC can run west very quickly as tarhunnas and smokendave know first hand.
Tarhunass was much farther east and barely hung on for a draw.
tm.asp?m=2792361
Thing have changed for sure, but still very hard to hang on once rifle squads get below 16k.
I think the key again is the snow ball effect that happens once GHC starts losing troops to pockets. The logistics system really sucks, once you throw in surrendered units taking 70% or more of replasements front line units get NOTHING and the front simply disappears by design.
I think your better off disbanding divisions once the front gets really short late game as another player has shown in his game.