It is not fully true, that the AI can sally out again and again. I don´t know much about 1.2.
I have played 1.0 and 1.5 a lot and it is a well know abuse, that you can siege the AI cities with just 1 mounted (light cavalry) unit and then run in a circle when they attack you. The AI could only sally out once and after a few turns you conquered theire city without 1 loss. You could win every fight with a single mounted unit.