If you see any AI faction expand like crazy, all you need to do is to sit back and watch (no diplomacy or alliances needed). In due time it will fall because minors will have a numerical advantage in terms of army count per region controlled.
Ironically, larger AI factions are easier for the player to conquer as well. Example: a 6 region AI has 3 stacks that you have to deal with. If those 6 regions were controlled by 6 minor AI's you'd have 18 stacks to deal with...
Back to the OP: I use alliances (also client states and satrapies) to spice up my game. I stick with the allies and that seems to drag me into wars that I otherwise would have avoided.
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