Well... I can see your point... But It's sorta of a tradition. Never leave your early bases undefended in a 4X, what you ask is like an Rpg with no rat-fighting and NPC errands in the beginning 

I wish bandits would raze cities. The AI of the 'creeps' is horrible - they usually just stand there and watch me do whatever; they are rarely aggressive and I have yet to see them take a city. I never leave defenders in any of my cities because the world is simly not threatening.

I wish that after a city was razed, there would be the rubble and ruins of a city, which could then be built on for less than the original cost of building structures and the like. Right down to Supreme Commander's style of letting you place buildings anywhere in the rubble, but having interface clues as to where the structure was previously placed that could be rebuilt at a reduced cost. While I understand a wooden house can be burned down, a palace made of marble and stone is unlikely to burn so readily. In the beta there was also the suggestion that it should take more than one turn for a city to be ransacked. Personally I'd like to see that as well, if for no other reason than to watch the cities burn.

There was the suggestion that a cities population would be able to band together and form a peasant militia. Brad seemed to really appreciate the idea, so I was pretty psyched to see it implemented in game. It was disappointing when I realized the few peasants that you get in the campaign were all that has come so far from this intriguing suggestion.

It would be convenient that when cities are founded they automatically have a peasant squad stationed within.  I think it would be consistent wtih common sense and fluff--I mean people aren't going to idly sit by while bears attack their houses, workshops, and arcane labs.  Otherwise, my cities just get attacked when there is no unit stationed there for defense.

Then why don't you just train/send one peasant with a staff with the pioneer instead of four. Only takes three turns. When inside the outpost, the peasant will have 10 hitpoints, giving him a decent chance of defending successfully against such early attack.

If you want even better chance,give him helm and bracers as well. A peasant with 3 attack, 3 defense(standing on a 50% defense bonus square) and 10 hitpoints has a very good chance to destroy the bandit.

A solution, so the game isn't as utterly harsh on new players might be raiding-

Bandits can loot a city when they attack and take money, materials, etc. out of your coffers (a percent tied to their level). If you don't have enough to pay, they raze the city.

So, a bandit might take 12 gold and 6 materials when raiding that outpost, forcing you to train a peasant to guard it.

It would be nice, for a change, to play a medieval/fantasy themed game where people defend their homes. It not just makes sense, it would be refreshing. It would work like free units available for city defense only. Normally they wouldn't be of much use, but they'd do if there are city walls.

Bandits and monsters would serve as a barrier to expansion (as already mentioned) and would threaten resources, caravans and stuff lying outside the city walls. Only stronger bandits and raiders could actually destroy cities.

you could have a garrisson script, where peasants are automatically created to defend settlements when they are attacked. the only problem with this though, is that if the garrisson is strong enough to defeat the bandits, then why would they ever attack? could be balanced once the mid game comes around (ie, the garrisson is only capable of beating early game monsters).

This is very true and the same results are for every difficulty level because monsters have only one behavior... wandering.  Thus the monsters are all stuck wandering getting high and drunk without any purpose.  You only have to worry if they accidently wander to close.  Long ago I posted a list of different monster/AI behaviors: https://forums.elementalgame.com/337474  .  And from the entire list the only one provided is "wandering".  What makes it worse is the wandering has a range limitation effectively placing a chain on the ankles of those poor monsters.  What happened to the living world we all wanted where monsters have different goals/purposes such as guarding an area, seeking weaker things to attack allowing them the strong ones to increase in levels, monsters seeking others for breeding which generates stronger offspring, raiders purposely attacking our caravans, others offering to independently attack as mercenaries for gold, etc., etc., ??  While monsters bump into each other and increase in levels the monsters never heal thus most of them because easy prey for the gamer.  Instead were stuck with only wandering.     

The other extremely bad piece of only having wandering as an option is during map creation!  As a result us map makers will be seriously challenged for providing interesting maps.  Last I checked we can't even assign units/monsters to specific players in the editor!!  Last I checked we can't even provide any existing cities for a specific player in the editor!! Until the cartographers table(map editor) is improved(and repaired) we're not going to see any campaigns or maps with any depth. 

You should have built 2 or so Peasants at the very least during the first 20 turns. So this kinda your own fault. You are the one that left a city undefended, if you can't spare the 10 gildar and 2 materials to defend it then you got bigger problems then bandits.  Not to mention you shoulda escored the Pioneer with at the very least 1 peasant if not 2.  This is essentially 4x game 101 by the way. Its kinda just how these games are. The wandering monsters/bandits/barbarians (in civ) are there early game to put some pressure and unpredictability into the early game when empires are too weak to wage war with each other.

Exactly !! The current monsters are way way tooo passive... my champions traveling thru a forest feel like they're walking thru a petting zoo.  I wrote this earlier, but it's so important I must say again:

What happened to the living world we all wanted where monsters have different goals/purposes such as guarding an area, seeking weaker things to attack allowing them the strong ones to increase in levels, monsters seeking others for breeding which generates stronger offspring, raiders purposely attacking our caravans, others offering to independently attack as mercenaries for gold, etc., etc., ??  While monsters bump into each other and increase in levels the monsters never heal thus most of them because easy prey for the gamer.

I want more cities to be razed. Particularly if I didn't research fortifications, if I leave a city undefended, it's in hopes someone will come in and raze it.

Keep bandits razing cities, I like it.