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I'm playing a campaign as Romani and have been very consistently installing fully Romanized governments thinking that being the most expensive to "purchase" they're the most desirable. Now I'm having second thoughts as I my empire expands. It is obvious the three government types have unique advantages and disadvantages and a fully-romanized province may not be an answer for all territories.
What should I do?
Depends on what you are going for. Lower level governements are better to raise local troops. Higher ones are better to develop the province.
Roleplaying may be another thing. For example the Romans were comparable imperialistic and therefore would prefer higher levels of governements; they also had the means to spread their culture all over Europe.
In some spots I would always start with a level 4 government when conquered by the Romans: Massilia, Syracusae, Kart-Hadast, Athens, Pergamon, Alexandria, and advandce the level later (when the client ruler dies for exampled).
When I was in a Romani campaign I would place level-4 for Gaul at least until my Brihentin MICs were completed. Spain received a level 3. Illyria and Greece received a direct level-2. Africa would get a level-2 to represent the utter destruction of Qarthadastim government when the Romani got there on account of their enmity. Germania would get level 3s since to a Roman, a local indigenous government there would be practically no government at all.
Establishing lvl 4 is quite good especially when there's need to quick build important infrastructure: roads, ports, improve walls, granaries etc. Then I usually go to lvl 2; lvl 3 is so far unnecessary to me. (I'm playing Romani, too). I have now conquered Arse in Edetania, which already has lvl 3 govt, so I think I'll not change it for a moment, at least until I build roads and port. Then maybe I'll change it to lvl 4 - as client ruler can be useful as replacement for my FMs going to conquer...
Yet maybe not - I think I can spare some FM to stay here and protect my interests...
As the Romani, I always install Type2 governments. Other governments don't really fit with my roleplaying of the Roman system. Type4 would be ok, if I role-played them a client state...
I install client rulers in a few places that would have them historically (Pergamon, Judea) but i tend to stick to the type III's until the Marian Reforms take effect. Then its all type II's.
From a strictly gameplay (vs roleplay) perspective, you should follow the guidance of the Europa Romanorum Thread in the Guides and AAR's section. Using the recruitment viewer, he generates a guide to what level regional MIC gives the most local troops in each province and deduces the best Gov type from that.
For the Romans, I just make a Type 3 or 4 whatever will let me hold the province without rioting. Then I upgrade to type 2. That's what I did in 81. That Gallic Province that has heavy cavalry would be the only one I'd leave as Type 4.