About the upgrades: switch the unit your factory produces. You get materials on ally death, to farm free $$$ too.
It's an incremental, so yeah, the enemy always gets stronger the more you play. Eventually you fight on multiple fronts, at around lvl 6.2, and eventually the enemy can shoot at your base from the start of the fight around lvl 15 or so.
Movement speed just makes your units weaker. Stop using it.
At first, have a factory that has 700 range (+200 over normal), and ONLY UPGRADE AOE SIZE, don't even bother upgrading damage. Don't upgrade range after around 800 range, more is useless (and makes your base vulnerable to enemy AOE if your units don't move away from the base)
The second factory, ONLY UPGRADE HEALTH AND PRODUCTION SPEED.
Figure things out from there, should be pretty easy/obvious.