OK. First of all, I don't think I'm overestimating fire density. In my example, you'll get hit with 4.8 .50 rounds from the Jug or 1 20mm from the spit and maybe 1 .50. You said yourself "Bullets are small and there is a lot of space out there for them to disperse into" This is true of .50s and 20mms. So if I'm the German in my example, I'd rather be crossing a Spit's bullet stream than a Jug's. I'f Im going to gamble my life on which plane is more likely to kill me, I'll take the fewer bullets flying my way every time. Especially since I've fired the .50 and know what it's capable of. Please understand that I'm not, under any circumstances, questioning the killing power of the 20mm. All I'm saying is that the Jug didn't need 20mm guns because it punched hard and threw out more lead per second (in weight) than a spit. I think there are two reasons the US didn't change to 20mms. First, they weren't shooting down bombers nearly as often as the other countries in WW2 and the .50s were more than adequate for bringing down fighters and strafing ground equipment. Second, was the logistics. They (.50s) were plenitful, cheap, and dependable. You could (pretty much) load the same .50 round into a jeep, tank, or aircraft. The US didn't really abandon the .50 in aircraft until Korea when thay foud that jets, with more robust construction and fewer moving parts to break, were not as susceptible to the gun.
As far as the punching power of the Jug's .50 I give you this...
"The 332nd Fighter Group also distinguished themselves in June 1944 when two of its pilots flying P-47 Thunderbolt aircraft discovered a German destroyer in the harbor at Trieste, Italy. One of the pilots, Lieutenant Gynne Pierson of the 302nd Fighter Squadron, using only the aircraft's 50-caliber machine guns, strafed the destroyer, causing it to explode and sink."
Ya gotta love the Tuskeegee Airmen!