Playing as the picts, I've always had an alliance with the vikings (usually their offer, too!) which gives enough of a breather to prepare a navy, though they never seem to break the alliance either. I've also had games (as other factions) in which I've gone to victory without ever fighting the Vikings. The VI campaigns seem to be a lot more variable and unpredictable than the main MTW map.

As for the Norse settling in Britain - over half of the villages around here have Nordic names, right on the edge of Danelaw, so settlement was extensive. They really were just light-fingered (and rather violent) farmers at the end of the day, and it was lack of farmland that drove the territorial expansion.

It probably isn't very realistic to portray Vikings as a single faction in the game, though, as power shifted between different Jarls. That would make an interesting mod, hmmmm (thinks.....)