Yeah I have a sneaking suspicion that the AI hasn't really changed since Rome: Total War. The only notable difference I found is that the AI can actually load an army up on a ship and land it, which it was incapable of in Empire (lol).
I actually beat the game now and well, let's just say that the only way to win it was to steamroll over everyone with massive armies, to keep producing/maintaining them them and to loot cities left and right. Diplomacy, economy, subterfuge...all mostly useless or at least pointless if you can make massive armies. Diplomacy is pointless because the AI is insane. Economy is pointless since it's broken. Subterfuge works and us fun, but for example assassinating generals isn't very effective since the AI cheats and can always create new ones. I should know, I once murdered 25 family members and 3 successive daimyos of a clan and they kept coming.
Another thing that I hated: at one point you become 'too powerful' in the eyes of the current Shogunate and are declared an enemy of Japan. That means everyone will declare war at you. I mean I can kind of live with that, although I think it's absolutely ridiculous that a weak ally I have a 20-year long friendly alliance with will declare war on me just like that, seeing as I can destroy them in a second.
Anyway, so everyone suddenly hates you and breaks their alliances with you and attacks you like a pack of rabid dogs. This is where the AI becomes completely retarded: even after beating them completely into submission and offering them - magnanimously - to keep one province and become a vassal, they rarely accept. If they do accept they will attack you a few turns later, signing their own death sentence by declaring war on an empire of 40 + provinces that allowed them to live less than a year earlier. The fuck?
Other experiment: there is one little island to the North of Japan that has one province. The faction holding it only had that island - nothing else. The entire coastline and North of Japan was in my hands. I was unquestionably the only super power left. So, I offer the little faction to become a vassal - spared from warfare, and allowed to keep their own rule. Sounds like a good idea right? They refuse. I offer them 40k (!!!) to become vassal and they accept. 2 turns later, they DECLARE WAR ON ME.
AI has a death wish. How hard can it be to simulate some sensibility and self-preservation? Last example: I'm on my conquering march and liberate a few provinces. In Shogun, if you liberate a province you can occupy it, loot it or (if it used to be the historical capital of a certain clan) reinstate a clan as a vassal state. I do the latter, so keep in mind I'm actually conquering a city and giving it to the people, to the historical owners. At first, they are very friendly and happy to act as a vassal. 20 turns later or so, as I am even more powerful, they declare war. With their one, crappy army against my machine of death.
...almost speechless. What a joke.