First of all, WELCOME, BwanaBob, to the SDMB!!!
I think you’re all on the right track here. Intelligence is a sword with two edges: one will cut the enemy, the other will cut its source. Two of the best examples of this conundrum come from WWII.
Very soon after Pearl Harbor, U.S. Naval Intelligence broke the JN-25 code used by the Japanese to communicate to the various units of the Combined Fleet. In a theater of war that was practically all ocean, that meant that we knew pretty much every move the Japanese were going to make, in advance. But using that advance intelligence without restraint would have led the Japanese to figure out in short order that their code had been broken, at which point they would undoubtedly devise a new code. Then we’d spend weeks or months cracking that one while operating in the dark. Instead, the intelligence gleaned from JN-25 was used selectively. At times, it was deliberately ignored; at other times, it was used to our advantage. But always the source was guarded through various means. The JN-25 intelligence was the basis for the stunning U.S. victory at Midway, against tall odds and only six months after Pearl Harbor, but it was used in such a way that the Japanese didn’t know the code had been broken. Similarly, the JN-25 info enabled a squadron of P-38’s to be in precisely the right place at exactly the right time to shoot down a Japanese “Betty” bomber that was carrying Admiral Yamamoto to a conference at Bougainville. Again, the Japanese wrote the incident off to random chance. The key to our success was “enforced inconsistency,” for lack of a better term. We used the JN-25 code intelligence only when the potential payoff was huge.
On the other side of the world, the British were in possession, early on, of working models of the German “Enigma” code machine, a pretty sophisticated device (for the time) that used a series of tumblers and drums to electro-mechanically convert coded messages into plain text. The “Ultra” program eventually obtained Enigmas for most of the German military services, and the quality of the intelligence provided by Ultra was on a par with what the U.S. Navy got from JN-25. But again, the British used the intelligence sparingly. For example, rather than take the chance of tipping off the Germans, Churchill deliberately declined to evacuate Coventry, even though he knew, through Ultra, that German bombers were assigned to blanket the city with incendiaries.
The true value of intelligence, no matter what its source, is the ability to anticipate what the enemy is going to do and act accordingly. There is seldom an advantage in broadcasting to friends and enemies alike the quality or quantity of the intelligence at one’s disposal.