What version are you playing? From 2.04i onwards, they get decent FM bodyguards which might make a difference in battle.

I don't know if the geographic impact of devastation can be varied, but the fiscal impact is capped so it shouldn't get too egregious. All I can suggest is using your starting forces to at least clear the direction you'd like to expand of one of those armies. Their placement is mostly to do with the size of settlements they are guarding (anything with a large town or bigger gets an army).