Thanks for the reply @tony. What I'm thinking of is something like autocorrection available in QMK, appreciate it may not be possible with the current hardware / firmware. In essence, the twiddler would see that it has output 'h', then 'e', then 'a', then a space and know it should then output four backspaces followed by 'have '. CharaChorder uses a similar model.
Good idea on the workaround. I'd considered it with Ctrl as Shift + a MCC on my layout capitalises the initial letter. Ultimately I've a couple of hundred of these so it would be unwieldy and definitely overshoots the current MCC limit.
Another example: 'the' followed by 'ri' gets changed to 'their'.