No amount of tweeking with rigid.get_angular_velocity & rigid.apply_torque_impulse was able to make stable turns. Finally discovered the mighty DAMP parameter, buried in the Godot editor.
Set it nearly to 1, then apply torques in the range of 1000 for a short axis to 20,000 for a long axis to get arcade responsiveness. It uses the dimensions of the Collisionshape to determine the moments of inertia. It's totally not an accurate simulation, but an arcade simulation. At least, it could finally be steered by a lion. Elon would smoke a joint to that.
The next problem is how to make a flying race interesting. Asphalt 8 works because it forces you to steer. Flying games have tried making levitated tracks. Some ideas: rocket nitro bottles in the air, virtual race track showing the most optimal trajectory in the air. The most optimal trajectory doesn't require turning.