As Doug-T stated many complaints regarding diplomacy is valid but my advice to you Afkazar is to not enter any alliances. When I´m playing as a catholic faction the only alliance I seek is with the Pope, no one else. My games have been more "peaceful" since I adopted this policy. It seems the AI is more cautious when I´m not allied with them.
When if comes to walking through other factions lands you´ll receive a drop-down message on the left hand side telling you that your relations has worsened. On the other hand you can exploit this by constantly walking in and out of another factions land thus eventually making them the agressor when they get pissed enough and attack you.

What I find more frustrating than anything with diplomacy/ reputation is that there are few ways of improving your reputation, that an ally can attack you directly without warning and that relations aren´t improved when you enter an alliance.