ive never got an enemy to surrender, no matter how doomed they are. in several battles my artillery alone could have killed every enemy soldier(which they ended up doing), but they didn't surrender. it seems they'd rather die ingloriously, mauled by shrapnel or burned alive, than surrender and live to fight anotehr day.

also: i think if they surrender they should retreat to the nearest settlement of their faction. and if they are not near one(such as spain with flanders),they must wait 2 turns before raiding or attacking, but they have a few more units.