I'd personally settle for a battle AI and a Auto-resolve AI that isn't completely dumb. If they followed some REALLY basic rules, like flanking (cavalry aren't supposed to charge stakes in the ground, i mean really, thats just stupid), tactical positioning (yes, let's sit at the bottom of this hill, so the enemy archers can pepper us for a while before we can engage them), and a semi intelligent town/castle tactic (yes, we are at war with them, but instead of having a garrison of troops on our border, lets leave a unit of peasants there), then i'd be happy.

AI cheating only relieves the symptoms of the problem, much like taking cough syrup. It doesn't address the problem, it merely covers it up, and hopes nobody notices. If it were an applicable handicap (as in a choice, since a level playing field doesn't prove a challenge to some more advanced players), then AI cheats are fine, but when it's applied just to make the playing field even, then something is seriously wrong.