Hi Victor!
I don't know how to split your post into several quotes, so I will answer in a solid block. You are almost right in expecting a left-intact rebel provice to be adjacent to your own lands. Almost, because you forget the islands. So when I deal with Italians, Sicilians, the English, the Byz, and occasionally other factions who have islands in their possession (once I had Russians on Malta!!) I use the tactics I descibed.
I'm also in a habit of handicapping the army of a faction in the last/sole province, but more often I don't invade but wait for the attack to be able to use all the advantages of a defensive battle. Mostly I don't have any problems with it afterwards as their single province can't support any troop producing.
Misunderstanding about "relinquishing". I may have chosen a wrong word, by which I meant "to stop possessing the province irrespective of the way or causes." Thus kicking out=being besieged=relinquishing in that post.
Speaking battlewise, you may find hard difficulty more appealing, but I think it is a matter of taste. On expert I often win battles when the enemy (having plenty of reinforcements) withdraws after the first stack was repulsed because it sees no perspective of victory. On hard I can hardly remember the AI behave like that. Plus on expert the AI is more cunning on the battlefield and does not forgive any mistakes of yours. And it has more attack bonuses (or so the beginner's guide to MTW teaches us).
But speaking strategically, on expert the AI is more agressive, it may attack you with several factions at a time, consistently turn down your marriage and alliance offers and generally give you more pain in the ... (select the organ you prefer). In a word, it does not let you relax and bask in the rays of your glory.
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