I usually start with occupying but when the cities get big enough and the sacking of a single enemy city and pay for improvements all over the Knigdom the temptation is too much...

Personally I would prefer it if the feature worked kind of like in RTW:BI where sacking the city left it neutral...

Say occupy the city to keep it, sack it to reck the buildings and loot the place but leave it with the original owner and Extreminate to cull the population and leave the settlement neutral (everying in charge is dead)...

The the last to cases you would always have the opion of attacking again and occupying...