I'd call it smart.
The AI perceived you as a possible threat. After you left there must've been more immediate threats at hand, such as the Hungarians. Maybe the AI also wanted to scare you off but didn't want to wage war?
So far I've not seen much outrageous stupidity from the campaign AI. In fact it's very clever with its agents.
BTW, I've just posted in the Venice guide section. You may find some ideas for your Venice campaign.

R'as