Einhander's Excuse Plot actually serves a purpose: to ensure your death. The Einhander missions are suicide missions with no chance of survival. You're supposed to be the same, except for the whole living through the experience part. The train mission was something Selene came up in a pitch to get you killed and collect data on you while they still can. The next two missions come naturally, since by surviving, you entered a base and have to fight your way out. By the time you escape the base, they've worked out a new plan which involves the ultimately inconsequential Climax Boss.
Doubly clever since Einhander pilots' non-survival is still useful, in the sense that they are used to build the ever-smarter AI algorithms for both the EOS fighters, as well as Hyperion. You simply happen to be the one-in-a-million survivor. Being The Empire, Selene does not exactly decide that you are no longer useless, but the opposite: you are so useful that you need to be killed to add your skills to the EOS' AI. After all, you just straight up and destroyed the majority of Gesetz' military force, imagine a thousand-odd force with your skills!
It's more of a meta-example, but the fact that the Earth forces all use German (not to mention having a vague Third Reich-ish angle) while Selene/the Moon uses English is in a sense reminiscent of World War II games, with Nazis as evil and the Allies as good guys. This also conveniently disguises the fact that Selene is The Empire and that you've been a pawn rather than a hero.
Hyperion's somewhat mangled English makes you think at first that it's a textbook case of Gratuitous English... Except that Real Life military communications also use odd words and sentences for the sake of clarity and brevity, doubly so when deep in enemy territory where communications can be intercepted and/or jammed.
Even setting aside the risk of mutually assured destruction, nothing's really stopping Selene from doing a decapitation strike on the enemy government with an Einhander mission (especially when a raid on Gesetz/Sodom is implied to be standard procedure), or Earth for that matter from doing likewise (as seen with the Stratagem and Schwarzgeist). Except they don't because there's every incentive to keep the status quo going. Maintaining a perpetual state of war against an enemy that could attack at any moment has allowed both regimes to keep a tight grip on power, justify an endless arms buildup, and control what their respective populations see. By simply surviving past the very first level, you've broken what ought to have been a delicately-sustained Forever War straight out of Nineteen Eighty-Four.
This coincidentally helps explain the actions taken by both sides as the game progresses. For Gesetz/Sodom, your rampage through its military forces prompt is implied to be what finally spurs Earth to launch the Stratagem rocket, throwing away any fears of mutually assured destruction to end the war right there and then. For Selene, your survival and destruction of said enemy forces has given it both valuable data for its EOS fighters, and a convenient chance to finish the job, allowing its leadership to claim victory with none the wiser. Unfortunately for either regime, you manage to foil even that.
In the manual it is stated that you don't go alone to earth but with a squadron. When you die you aren't being revived/ being sent back to the time before you died, you are controlling one of the remaining ships in your squadron that has caught up to where you got killed. Essentially you only play the protagonist on the life where you finish the game!
In The Stinger after the credits, the Endymion lights up again implying that your Einhander pilot survived — and is now gearing up for another conflict. Seems that "temporary balance" of peace wasn't as long-lived as one would hope.
Between the time that you destroy the Schwarzgeist, get turned into a moving target for the EOS, and initiated your one-plane Roaring Rampage of Revenge, one month has passed. Who supplied your food, ammo, and that new space-boosters?
It can be assumed that some people on Earth know that Gesetz and Selene fight over nothing but lies from their leaders and wish to end the war. When word spreads that the freakin' Einhänder was betrayed by Selene but managed to escape, they might see it as the best opportunity to stop the conflict.
