"Winning" or "losing" wasn't the point of the exercise, the point was to test and practice the new network-centric warfare concept. The Red Force commander, van Riper, hijacked it to prove some kind of point. He exploited the rules in a way that made his forces overpowered compared to their real-life counterparts and was assisted by having Blue Force not even using their self-defense capabilities (because a Blue Force commander had ordered them "turned off" because they weren't supposed to be part of that exercise during that point - something that never ever happens in real life) resulting in a completely unrealistic outcome.
The reasons they couldn't handle "losing" was that they weren't supposed to. It was a $250 million dollar exercise that included a simulated amphibious assault. Just going "dang, he beat us, back to the drawing board" would have meant throwing all that away, wasting personnel time and depriving them of valuable practice in order to "beat" van Riper. That's just ridiculous.
The Millennium Challenge got way too much print with media all over the world using it as proof that the USN can be easily countered despite it proving nothing because it was never really intended to.
^^ people make this mistake all the time about war games. It's less about winning and losing and more about getting some reps in.
It seems like Van Riper (and someone high up in Navy command who could give the order to shut off the defense systems) wanted to get a message across to the sailors that they weren't invincible even with the greatest hardware, so they rigged up a scenario to do just that.
If this were actually a remotely plausible scenario, the navy would have already significantly updated their doctrines. An attack like that in the real world could maybe do some damage to a fleet led by overconfident admirals and commanders before they adjust to the tactic, but it is basically impossible to be able to do it on that scale, because no one has the assets to pull something like that off in the real world. It only worked in the exercise because the red team got to use whatever resources he said he had, while in a real war, he'd be limited to the stuff he actually had.
Spending is great at getting all the new toys first. Being second/third also allows copying to be a viable option at saving costs. As long as the number 1 doesn't use it first on number 2 and 3, being number 2 / 3 allows getting good stuff cheaper due to not spending as much in R&D. Might not be as good but can be just as effective cause in the end, all it takes is one bullet to kill a person, or one missile to sink a carrier.
The US can win any symmetrical war, but all it takes is a few battles to change it into an asymmetrical war. I would not want to fight a developed nation that has technology in an asymmetrical warfare scenario. They would have options available that the Taliban would only dream of using. With modern weapons and a populace that is determined, any occupation becomes a bloodbath.
Occupation would likely never be a plan for the US military in a symmetrical war anyway. Depends on what the war is fought over and what the endgame goal is of course, but the US doesn't need territory.
The only realistic scenario I would see the US willingly engaging in a symmetrical war would be to protect a close ally and/or to prevent a regional power from interfering in our diplomatic and trade relations with another nation. Scenario 1A in likelihood would probably be China trying to do some fuckery with Taiwan. 1B and 1C are probably the same scenario but with Japan and Korea.
In that case the navy's role would mostly probably be just to provide air superiority over Taiwanese airspace and prevent China from trying to land troops on Taiwan. In this role, they could keep the fleet relatively safe from land based anti ship cruise missiles launched from the Chinese mainland which is at the moment the biggest threat.
Same situation on the European front if Russia did something crazy like attack Poland or another NATO member. I'm not sure Putin is crazy enough to test NATO directly though.
I see the China situation as more likely though because with the amount of population they have, China is likely to need more resources than they can produce domestically, which has historically been the number 1 cause for war. Russia has plenty of resources and a declining population, their only reason for starting a war is ego driven nationalistic dick waving.