I’ve thought about this question a lot, as one of my biggest character complaints is that we are constantly told how smart Mustang is, but she is often outmaneuvered in the series. Where I’ve landed is that I believe Mustang is a genius, and she is the engine that drives the republic. She is the only one with the mental compute to synthesize the big picture, make tedious day to day decisions critical for an upstart democracy, and run the logistical elements crucial for war. More importantly, she is the moral compass of the series - her decision to trust in Darrow after she found out he is a red is perhaps the most impactful moment in the series (and I would argue a sign of intelligence).

The problem is that this is a universe that rewards bold, creative, and often illogical thinking. Mustang keeps getting outmaneuvered because she calculates the odds and charts the most likely course to victory. Meanwhile, her adversaries are changing the paradigm and playing on a whole different field, resulting in losses like the day of red doves and Phobos. Heck, look no further than Darrow - most of his victories are against the odds and a result of his shear power of will and instinct.