Wow, now I see what most people have been complaining about for the past couple of years. I'm not having much fun racing at all on the dirt and ice. I like the new tracks, and I like running on them alone. But to be humiliated by a road car when I'm in the Subaru Prototype, man, it takes the fun out of it real quick. Then I hop in the twice as heavy Dodge truck and proceed to outrun the road car. Strange.
I dont really see how you are losing to road cars while driving a rally car, let alone being humiliated. You must be hitting the walls constantly if you are that much slower. Like I said, run a ton of practice laps for each track before you race on them. Also, you might want to try another rally car. I never liked the Subaru prototype. If you want an Imprezza rally car I recommend the '99.
Some general tips:
More than anything, throttle control will win the race. You really have to be extremely, and I mean EXTREMELY gentle on the throttle though turns. You pretty much never want to be at full throttle at all during a turn, unless its a very high speed turn.
The key to rallying is to master what I call the 'swictchback' turns. These are the 180 degree turns that are usually pretty tight and come in a series. There are different size switchbacks on each track, but I approach them all the same way. Basically as you are coming up to the turn, point your car AWAY from the turn aiming at a slight angle towards the outside of the turn. Trust me on this. Ever have the problem of hitting the front end on the inside of the turn and coming to basically a dead stop? This will solve that.
As you aproach the turn, slow down enough so you dont have too much momentum going into the turn. Next, just as the turn begins, hit the brakes and turn in simultaneously, aiming for the midpoint of the turn. Immediately after that, jam the throttle and then quickly back off the throttle to get the back end loose. Now use very small gas and brake imputs to keep the back end rotating through the turn, while using steering to keep the front end pointed at the midpoint of the turn. As you come to halfway through the switchback, use the gas to bring the backend even farther through the turn so that now you are countersteering. Keep countersteering through the second half of the turn, keeping the front end pointed at the midpoint of the turn, until you reach the apex. At that point, let off the gas a little to bring the backend back in line with the front of the car and unwind the steering so that you are pointing down the next straightaway. Once the car is pointed out of the turn and the back end is back in line, gun it.
Follow this advice and practice, practice, practice and you will be able to win any rally against a comparable car. The AI is extremely slow through these switchbacks. They basically approach it like a normal turn, slowing down a ton to keep traction, instead of drifting through it to keep the momentum. The rest of the non-switchback turns I approach pretty much the same way: as you approach the turn, using steering to point the car the way you want it to be facing when you exit, and then use gas and brake inputs to keep the car sliding smoothly through the turn.
Btw, I use the dualshock, not a steering wheel. So it is possible.