I used to use Hard, but as it has been mentioned, because areal refuelling isn't modeled, and because the AI never runs out of fuel, I've started to use Normal. It would get very frustrating to me when I see the AI using burner liberally, while if they tried to bug out, and I tried to chase them down, I wouldn't be able to catch them before running out of fuel, even if they were in a smaller jet using burner through out the fight, and for their bug out.
Using Normal also has its drawbacks - aside from a slightly less realistic feel, it makes a heavier fighter in a dogfight. It's less noticeable in a smaller fighter, but I really notice it in the F-14, F-15E; fighters that carry a lot of gas. I'd prefer to be around 50%-60% when I get into the dogfight, burn gas in the fight and max loiter my way back to base afterwards. Trying to turn or zoom even in the more powerful F-14B or the Eagle with near full fuel makes it a royal pain to keep energy up to effectively fight, or to fight slow in a high alpha vertical fight/scissors.
Earlier, real life fuel burn rates were discussed; over at the Tomcat Sunset website the same subject was discussed and the sim is quite accurate in Hard settings based on what was discussed there, and as FC mentioned here: your fuel consumption rate in burner is exponentially higher than in military power. We're talking about depleting fuel in minutes here, which is why mid-air refueling is such a necessary tool for long missions.