I play on Hard and I have the same problems. I know in RTW it was supposed to be less battles but with more importance - but it seems totally the opposite. When the enemy can even get a full stack together they're most likely not led by a General, and he's just chilling in some valley alone not leading an army or governing a city. I believe that if the Generals began leading armies, gathering troops and then invading regions with full stacks - perhaps one full stack buffered by other stacks of troops - that would create the expectations which were set.

How it is now I agree - the battles happen all the time and are neither decisive (impacting on diplomacy) nor satisfying (yay I just routed their army without losing more than a couple skirmishers...). In MTW it was much harder fought prettymuch any battle - I think that with a couple tweaks to the battle engine and the campaign engine and we might have a winner.

One thing that has made me stop playing the game is that RTW is a combination of the worst possible algorithim you could hope to conjure for a buggy game which doesn't satisfy. I'll explain:

/1 - It's the revolutionary game. This means that nothing is honed or polished because it is the first incarnation of the game in this complexity and this amount of change. Imagine what the Evolutionary game will be like; probably much less bugs and will have features defined and working correctly. This TW game is the first to use 3d so that makes for more possibilities for error what with that large change.

/2 - The market for the sales are Hollywoodized kids who don't know a sarissa from a halberd. Perhaps in the future evolutionary releases we will be thrown a bone that will quench the fans at the Org who want more than the lowest common denominator for historical battles and empire building. It's likely, I think, that CA has not merely turned a blind eye to the rage, frustration and agony that RTW's release has caused the community. That's my hope and it's why I am still here.

That all being said - Age of Empires 2 went to Age of Mythology = 3D Revolutionary game for the series. After playing that for a couple months there were only minor problems with the game which were patched as soon as they could - at the moment there have been ten patches released - some of them merely to balance units so that they aren't overpowered and so that the battle system works more deftly. Oh yeah - and with AoM they released a brand new dedicated server to play online games on called Ensemble Studios Online. Right out of the box it worked great - but there were a number of patches released to enhance the experience. So can it be done? Yes. So don't dispair.