I'd work on industrializing if I were you.

Attacking you have many options as far as making peace with whoever you attack. You can take a few provinces depending on your warscore, puppet, annex, humiliate, etc. Annexing smaller countries(like the small one to your south) is fine and won't affect your badboy much. Attacking someone also takes away some of your prestige.

Generally I go and look for goods I need for my factories/POPs when I want to conquer something.