I have just had the same situation in French campaign (early/hard).

Atfer I ousted the English from the continent, it all started. I was attacked by the HRE and took Lorraine and Burgundy as a result. Then before I moved to take Provence, the Aragonese joined the show. I managed to build a ship in Toulouse that was almost immediately sunk by the Italian. Once I got rid of the Aragonese, the Spaniards attacked me in Aragon so that for quite a while I just fought defensive battles (Spaniads attacking Aquitaine or Aragon, Italians attacking from Milan and Genoa, HRE trying to recoup its losses and English trying to get Flanders). Even though I had quite a few ships I was not making any money because nobody was eligible to trade with me so that I could not build anything except troops to make up for my losses in battles (only exception being due to some cash injection when ransoning prisoners). After many beatings, the German forces were so thin that it became quite easy to add Friesland, Saxony, Franconia and Swabia to my holdings. That gave me a border with Polish Silesia and the Poles attacked Franconia almost immediately (my army being made of many units of calvalry and theirs of almost javeliners that was quite easy to get the "skilled defenders" trait)....

Now (it's about 1195) the Spanish king is dead and I have a buffer between me and the Almos. I fear it will not be a great help since the Almos have done nothing since the start of the game apart generating stacks of AUM and are butchering the rebels ... I am also pretty sure that the Danes familial cavalry will also attack Saxony sooner or later ... Hopefully I have started making a money cause I have got enough ships to trade with the Almo, Sicilian and Egyptians (the drawback being that I can forget about crusades if I do not want to go bankrupt) so that I can upgrade my army in order to face the AUM when the time comes (my current army is mostly made of spearmen and holibars that are bound to be butchered if faced with AUM that are lead by a decent general) ... Seems that total domination is the only option now (except that perhaps the arival of the Golden Horde will get the Poles off my back) ...