The Luftwaffe attacked both battleships to split their fire (both received minor damage) and the RN force around the carrier was reduced to only the two BBs, WARSPITE, VALIANT, ILLUSTRIOUS, and destroyers NUBIAN, DAINTY and GREYHOUND and only Nubian had an AA FC system. The other RN forces in the area were screening the Malta Convoy. The radar system did not detect the attack and there was only 3 minutes warning from sighting the Lufwaffe force to first bomb hits. When Illustrious turned into the wind to launch her remaining Fulmars she also moved away from the slower BBs.
In later attacks against Illustrious the fleet formed a more concentrated formation, but not during the initial attack.
Now even 2 BBs, even if Warspite's AA wasn't so powerful but Valiant's was very powerful, best what RN could offer, and 3 DDs wasn't a minimal AA screen. And Adm Conningham believed that he had a ring-side seat to watch the attack, the professionialism of which he greatly admired. And he was on the bridge of Warspite, so the ship couldn't have been so far away. And if 10 out of 43 Stukas attacked the BBs, it was a question of tactics used, not of the size of the AA screen. and also meant that there were 10 Stukas less to attack Illustrious
So conclusion, whether one had 2 seat or single seat fighters, the CAP could be distracted and the CV could be left without fighter protection. Your theory that the observer would greatly increase the possibility of noticing approaching aerial attack isn't IMHO valid, especially when looking the position of observer in Fulmar. 4 SS fighter formation should have been able to adequately observe their enviroment in the limits given by the weather.
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