Regeneration happens directly on the crankshaft via the mgu-k, not the wheels. The mgu is essentially a governor, so you can set it to add or sink (absorb) torque however you like. If you're adding torque, you're draining the battery, and if you're sinking torque, you're charging the battery. Because everything is mechanically connected, sinking torque also wants to brake the car (i.e. regenerative braking).
In terms of power balance, on average, the draw needs to match generation for the system to work. Since this a race, the battery should be flat when you cross the finish line, because you don't want to leave power on the table. When cars are clipping out on the straights, they're trying to claw back some power for the battery so they can deploy it at a more impactful moment in the race. Maybe it's frustrating for viewers, but part of that is that the vehicle has a maximum sustained power, and a maximum total power, and those aren't the same thing.
The mgu-h was cool, but I believe the teams when they say that it was too difficult and too expensive to get right.