My take would be to say that an undetected cloaked ship cannot be targeted... not damaged. That way, if they have a cloaked ship travelling alongside an uncloaked ship, you could accidentally damage it while targeting the valid target..... But, that you could not target a specific hex due to the fact that the player knows that the ship is there, while his captain would have no means of detecting the cloaked ship....
Insist that there be a valid target for the AoE weapon to be aimed at.....
As of right now, I could cloak 3 ships, fly them up to adjacent hexes with an enemy ship, hit him with a few AoE weapons from the rest of my fleet, relying on my cloak to avoid the damage, and then decloak and fire on the damaged target from close range.... Or, if I am using ships with AoE, I send in ships with cloak generators to battle, and to pull the enemy into a close small area, and then have them cloak for the turns that I am sending in my big guns.... My opponents ships are now in locations where I can concentrate damage... and if he uses stealth, or ECM, I can target my own ships (I know where they are, so they are detected as far as I am concerned) to avoid those penalties, but my cloaked ships would not take damage......
Like Dan said, we want to keep the rule simple, but also avoid abuse.
Nahuris