Still trying to build up my previous high level of enthusiasm for the game.

I assume that for Rommel's initiative increment to take place, tanks use their shooting line of sight to determine if they can see Rommel.
I.e. an assault gun would not benefit even if Rommel was right next to it but slightly behind, whereas a turreted tank would have no such problem?

That's not quite how assault guns are phrased, Rommel's tank would have to be at least partly directly in front of the assault gun if any part of it was behind the front glacis line for the Assault Gun to draw line of sight to it. Kind of an odd quirk, since the crew can see more than the tank can shoot. Maybe they forgot assault guns existed because they didn't release any in the desert expansion. It might've helped if they checked Rommel's line of sight instead, as you aren't likely to put him in a Stug or Pak wagen. Though the jagdpanther would be a solid choice.