I’ve given up on any of the numbers making sense and just ride to my own abilities instead. For example, I’ve pushed 350 watts going down a 7% grade and it shows me going 23 MPH. I’ll put out 300 watts flat out on a 0% and peak at 23MPH. Going up some hills, hitting 500 watts, I’ll peak out at 7 MPH on a 7%. This is on a powered trainer. Yet, my son who’s on a Z-Power trainer that is set up correctly will fly down hills at 45 MPH, up 7% hills at 15-18MPH, etc. He’s really fast, but not quite that fast - especially with his juniors gearing.
My thoughts so far - work really hard on Zwift and accept that the numbers aren’t related to reality. Then go out to a legit outdoor ride and see how holding 250 watts for 20 minutes equates to MUCH faster times than you’ll ever get on Zwift. Kind of like running with ankle weights then taking them off for the big event.