Hi Lobo, and welcome to the .org.

1. The AI cheats, but not financially, AFAIK (though the Golden Horde are a financial curiosity I haven't quite figured out yet). What they do do is keep about as many troops and ships as they can afford, which is unfortunate as they never accumulate much capital to support real development and make for a major challenge. If you go into the red you will not be able to build any new buildings or train any new troops until you get out of debt. You will still be able to borrow money to ransom captives, I believe, though I've always avoided debt so I haven't got any personal experience.

2. An army of loyalists depends more on the loyalty to the enemy than the former loyalty to you. If they have enough troops/low enough taxes/etc. in one of your newly lost provinces, they won't get any rebellions, whereas if the loyalty to the new master is low, you may get loyalists. It's still largely up to chance regardless, though.

3. Even the most obscure nation can occasionally become a major player. It's not that uncommon for the Turks, but I've only seen the Aragonese get powerful once or twice. A little more often for the Danes, but they also usually just hole up in Denmark and stockpile Royal Knights and debt. However, there are certain factions (Elmos pre-VI, Spanish post-VI, Egyptians, Novgorod in XL, etc) that almost always seem to get enormous.

4. Losing a battle (depending on other circumstances as well) can get bad vices for the general, which could affect loyalty. I'm not certain about losing an attacking battle, but losing provinces lowers your ruler's influence, which will affect both the loyalty of generals and the loyalty of the populace.

Ajax