I’ve just started playing the new 2.01 version of GalCiv2 - Dark Avatar (have played the old one before), and while doing that came upon an idea for a different approach to matching the difficulty level, and in particular the AI, to the skills of the player. The idea applies to all turn-based strategy games, and could be used in Elemental, as far as I can see.
One of the things that bothers me the most about strategy games in general, and this goes for GalCiv2 too, is that a game usually ends up being too easy or too hard, and thus either becomes boring or frustrating. In both cases, the game fails to provide me with the entertaining challenge of having to make the best game play choices in order to be able to win, which I’m looking for when I buy the game.
The problem is when I’m supposed to choose the difficulty setting before a game, as I don’t really know how normal, the “normal” setting is, or how easy/hard, the “easy/hard” settings are. Nor do I necessarily know how good I am at the game, if it’s my first time playing it, or if I haven’t played in a long time. Is the 10% economy penalty and general AI algorithm the setting that matches my own playing level? Or am I closer to the 10% economy bonus and advanced algorithm? How do I know?
So, in my experience, picking a difficulty setting that is in balance with my ability to play the game is usually impossible, leaving me with a game play experience that either lacks a challenge, resulting in the kind of boredom that makes me quit the game and not want to pick it up again, or if it’s too difficult, gives me a frustrating experience of not standing a chance to win, in which case I also want to quit and not pick it up again. Because the AI players are too far away from my own playing level, turn-based strategy games usually fail to provide me with the challenge that I was looking for in the first place. This is, in my experience, one of the primary reasons for why I quickly lose interest in what could otherwise be a great strategy game.
To solve the problem, I came upon this idea:
During play, the game measures how well the player plays the game, and adjusts the difficulty and AI accordingly. There are many ways you could handle this. If there is a playable tutorial, you could use a default easy difficulty/AI setting during that, and measure how well the player handles this challenge. The measured player skill level will then decide what difficulty/AI setting the next game will be on. Thus, the tutorial not only teaches the player how to play the game, it also teaches the game how to balance the difficulty/AI settings to the player. If there’s no playable tutorial, you could let the player choose a difficulty setting of his liking for the first game, and measure his ability against that.
Measuring could be as simple as how high a score he gets at the end of the game. A more advanced (and probably more efficient) way could be to have a number of parameters that translate into AI/difficulty settings, that you could measure, like ability to balance economy parameters, time to build civilisation, speed of exploration, ability to design and use military units, etc.
You could keep measuring this for each game he plays, and as the player develops his skills and gets more experienced, you can adjust the difficulty/AI accordingly, when a new game is started. It would then be desirable to allow the player to choose the level of challenge he is looking for, and match the difficulty to it. Thus, if a player plays the game predominantly for the feeling of empowerment, rather than that of a genuine challenge, he should be able to set the AI to play below his skill level, as he will not risk losing, but still gets some sense/illusion of challenge. Those that genuinely play for the challenge, like me, can choose a balanced setting, where the game logic tries to match the skills displayed by the player, to the best of its ability. The masochistic player should also be able to choose a difficulty level above his skills 
The measured skill level of the player could be computed into a number/rank that he can view. This would add an element of achievement, besides winning each game, to see how high a skill rank he can get. Further, it would be possible to use the rank to find matching players for multiplayer games.
Of course, it could still be possible to allow the player to choose a difficulty setting the old way, if he wants that, while giving him the option of this dynamic, personally tailored difficulty setting.