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I've been struggling, really struggling to optimize Russian play and have come up with the following (hints/suggestions/criticisms are of course more than welcome) general guide to help avoid the worst:

Spy on Germany - this is tough to do, a good 8 PPs/24 spy points are required to make headway and is indeed a bitter pill to swallow (until you start getting your first tech steals.) It is quite hard to keep pace with German technology, but if the investment is made early enough and is sustained over the course of the game, perhaps 1 spy every 2 turns after 1940, can really make a difference. It is unfortunately equally necessary to raise your own security into the high teens/low 20s to make sure the German does not know this is going on. Typically, after the commencement of Barbarossa, the German player will find himself so short on supply he will neglect security and spies vs Russia, in other words, it's really tough at first, but gets easier as the action picks up.

Do not hesitate to move factories. This too is quite hard, but if the German is advancing rapidly or even failing to grab important places quickly enough, moving the factories at Kharkov, Rostov and Stalingrad is an option. The key benefit here is the denial of VPs to Germany for the AV. Avoid unit builds in border areas because of this, use them to build research or even supply, any units on the production spiral in these places will be lost when you move the factories, ouch![:-]

Build some tacair/HBs. 2 or 3 of these are typically enough, but you really need them to get the combined arms bonus for tricky situations. Remember when building spies to keep at least 1 tech point on each unit attribute you think the German may be researching, this is particularly important for your tacair, otherwise it is the type of unit that languishes because the Russians cannot afford to upgrade. With lots of spies and only 2 tech points invested (typically EV and LA) you can keep relatively equal with the other, more modern, air forces. Clearly, the same applies to fighters, but here you will need to buy 1 initial point for speed (range) as well in order to get the most bang for your buck.

Build INF in Leningrad from turn 1 onward and never stop/strat move any away. Again, retention of the place is more about denying an easy AV than it's actual strategic position (which quite frankly is not that important.)

Build tanks in Moscow and Kharkov starting on turn 1 and never stop.
Move the tanks you build in Moscow to Kharkov while frozen, there is a chance that you can retain this town for quite some time if you continually reinforce it. Move a tacair and some fighter protection here as well if the German appears to be going for the Caucasus via Turkey, they will op-fire on naval forces in the Black Sea and slow this tactic down a bit.

Do not abandon Vladivostok. When things get crazy with Germany early on, there is a large temptation to pull the units out of Vlad, this just makes a bad situation even worse if Japan gets tempted by an easy grab. Again, because of the RP and factory, this equals a VP for the Axis. Again, if the Japanese are so inclined they can then move even farther inland, destroying/occuppying resources on their way west.

Always spend whatever is humanly possible on the EV and LA ratings for tanks and INF, maybe ART as well (though I no longer do this due to the suppression rules and the impossibility of keeping up research on 6 unit attributes with intensity.)

Seriously consider builing 1 more factory in both Central and Southern Urals, these become vital to your ability to sustain the effort if the German takes out more factories on turn 1 than just Kiev and Belorussia, they are also relatively safe from air attack and do have population points (so you can build combat units.)

DO move INFs from Karelia/Caucasus, etc to Eastern Poland (must repair the rail there first to do this) until you hit production multiplier 2, after that, it starts to hurt your internal redeployment too much and exposes too many units to an easy kill upon the commencement of Barbarossa. With the WR increase of +1 for each inf moved, this generally results in Russia hitting x2 production quicker by 1 turn and pays for itself (the easily lost units on the border and the 5 supply for the rail repair.) Unless you really think the German will wait until the last moment to attack you, do not continue to commit more units here, the costs far outweigh any benefit.

Some solid ideas there.
 
A few added points:
 
1) Continuing to move units to EP can still pay-off if it screws with Germany's timetable. You'll certainly lose more in the opening attack and you wont have any strategic depth, but sometimes that might be worth it if it saves England or the Med from being overrun in 41 (since Germany will have to prep to fight Russia earlier). Of course if Germany's plan all along was to attack Russia in 41, you could be setting yourself up for a world of hurt. So, its important to try and ascertain Germany's intentions first (which play nicely with the increased resources spent on Spying).
 
2) Lend Lease to China. Russia can really help keep China in the fight by giving her supplies. Often it looks likes its just money thrown down a hole, but it can also keep Japan busy putting out fires in China. The more time and resources Japan has to spend on reducing China's econ to slag, the less Japan will have to throw at the WAllies or Russia. China needs to remain a credible threat and the easiest way to do that is to LL supplies in to keep the factories repaired and the railways functioning. Again, as with above, you'll have to judge at which point it becomes money wasted rather than money invested.
 
3) If you arent going to move units to EP en masse, then it can pay off nicely to build 2-3 factories somewhere safe (Urals as mentioned). If Germany attack in Sp/Su41, you'll barely pay back the investment, but if Germany delays until 42 (which you are encouraging by not moving into EP), then you'll be getting a 4-6 PP return every turn that Germany leaves you alone past Sp41. This can add up to some substantial additional troops or supplies. The downside can be two-fold. If Germany attacks in 41, you'll likely be weaker than normal and by not pressuring Germany in EP, you are potentially endangering the WAllies if Germany is making a major push westward.
 
4) Early investment in Artillery (quantity, not quality) can pay pretty nice dividends for your Militia. Normally Militia cant really hurt most German units in 41 due to their low attack. But the suppression from the Arty can really help your weaker units score hits. I've had some success spending less on Researching up my Infantry/Armor attack ratings and building up massed Arty instead. You'll need some Fighter cover (or preferably Fighters/Flak in combo), but if Germany doesnt heavily suppress all the Arty before attacking, they can suffer ridiculous amounts of casualties from units they would normally be almost immune too.

Great points, Uncle_Joe, thanks for sharing (I might just have to check out more ART!)

Also: do you usually repair factories in China with the LL or merely use it directly for attacks?
I typically do not do this (because I am paranoid over the safety of Mother Russia.)

Could somebody please explain what's behind the "garrison Eastern Poland" issue? I think it has to do with garrison requirements and/or Russian war readiness, but I don't fully understand the implications.

Read section 10.2.2, increasing the Soviet Union¡s war readiness level, 4th dash/hyphen.

- Increases by one (1) at the end of the Russian movement phase under certain circumstances if the Soviets increase the size of their forces in Eastern Poland. If Eastern Poland is still frozen, the Russian War Readiness increases by one (1) if the number of non-militia ground units in Eastern Poland has increased during the Soviet turn (not counting the initial move into Eastern Poland due to the partition agreement). Note that after the Partition Agreement the Soviet player needs to repair the rail in Eastern Poland to move a unit there

ORIGINAL: rjh1971

Read section 10.2.2, increasing the Soviet Union¡s war readiness level, 4th dash/hyphen.

Thanks.

ORIGINAL: christian brown
Do not hesitate to move factories. This too is quite hard, but if the German is advancing rapidly or even failing to grab important places quickly enough, moving the factories at Kharkov, Rostov and Stalingrad is an option. The key benefit here is the denial of VPs to Germany for the AV.

How does this deny VPs to the German? Are you referring to the German ability to repair the factories if they are flush with resources, or something else I am missing?

Yep, that's precisely what I meant.
Here are all the benefits of moving factories as I see them:
Denying VPs to Germany (as you state above, repairing and linking to a resource)
Denying supply building factories to the Germans right upon the front (much better to have him have to rail supply in from farther away, IMO.)
Keeping your own production healthy, typically you WILL have the resources to run all your factories, even with 2 new ones built in the Urals.  At FM3 we are talking about 9 production points available to the Russians (remember the free trade/TA income when calculating this) if they move the factories in Rostov, Kharkov and Stalingrad.
Personal fetish-I like the idea of having a Russian factory in Kazakhstan, it just floats my boat (and helps disperse the effects of a German air campaign if Goering goes bomber happy.)  Oftentimes, I'll even move a factory way out east to Siberia, in total safety, just for building research.

Several games now that I am struggling to defend the Motherland. Will try to apply this.