the AI Scots have fought their way all the way to Dijon in my Byz campaign, and have attacked me in Milan. Not as a result of anything I have done as I've mostly been busy on the other side of the world.

Anyway, I don't think there's any meaningful comparison between what the AI does with a faction and how easy it is for a player.

Every faction I have tried can put together a stack that can consistently whoop the AI in battles, including the Scots.

In my experience, the biggest determinant of how difficult a faction is starting position. Corner factions like the Scots have only one front to worry about. You can essentially defend yourself against England with the same army you are attacking them with. If you play Venice or the Byzantines, on the other hand, you are going to be attacked by everyone from all directions, and you will have to make a lot of difficult calls about how thin a force you can get away with.