Personally,  I don't think the monsters are working as intended.  Since the AI builds like mad and the monsters ignore them all the real estate will be bought up whether the player expands or not.  I guess that hits all three of your points.   I was hoping the monster issues were gone.. guess not.

One last thought, are you taking into account monsters from dangerous quest zones?  Areas where you get next to them you trigger some kind of screen and quest.  They typically spawn wandering monsters along its borders.  Kill some, it will just make more. 

I will continue to monitor the AI, but let me assure you that the Monster AI is in many cases ignoring the Faction AI. There are several threads from beta 4 highlighting this issue.

A couple games ago I watched the AI run through the middle of a forest full of monsters and steal two heroes I was unable reach due to monsters being too tough. The AI ignored the monsters and the monsters ignored the AI. A few turns after the AI passed through my territory into this forest the AI sent two heroes it hired (so I lost the chance to hire two) back north through my territory.  So between the non-existant AI/monster relations and the fact the AI passed through my territory multiple times (after being told repeatedly to leave) it creates an imbalance in the game.

I am not saying the AI never attacks the monsters. I know for a fact it does. Soon as a champion or sovereign has a couple units with it they start clearing everything (including unhired opposing faction heroes.) 

Maybe the chance to pursue/destroy units is out of tune. I only say this because it seems that most everyone sees it fail more often than anyone seen the monsters attacking the AI. I also say this because I have literrally reloaded to a previous save and had the monster wander in a different direction instead of atacking a city.

The monster AI just seems really dumb. Players dance around tiles avoiding it while it chases, then steal their loot. They only seem to become aggressive after a certain period of time (ie they forget they have a lair.) Then it goes to the other extreme of having a monster so tough only the AI can use that part of the map.

If Warden could make it so that no monsters came within the vicinity of its control, that would pretty much fix everything. Currently Wardens, built at an outpost, seem to politely dissuade monsters. The mechanic needs to provide security from monsters. Why else would I build it? Make it more expensive to build if that is needed, but don't let a monster sit next to my outpost for 50+ turns, waiting for the random value to roll in favor of killing my outpost. If you watch my let's play videos, you'll see some pretty damning evidence that monsters ignore the AI and don't notice Wardens. Might be worth a second look.

So if the monster is not seeing us as different, perhaps the AI is simply not seen at all? If the monster never saw the city next to him and then suddenly noticed it when it was taken over, that could explain the behavior. Perhaps we should look at the same situation when an AI takes over an AI city with a dangerous monster nearby. If the monster still attacks after the capture, that is a good sign. It would then either be blindness or the fact that a damaged army is weak and easy to kill. If the monster leaves it alone, I blame  .

That is exactly what I am looking for. Something that prevents easy expansion, but not so overwhelming it will take hundreds of turns to research and build units to conquer the monsters to expand. However I do not beleive in destroying cities simply because the game has no ability to restore the settling ability to that tile. If the game reverted the tile to its original settle values I would not mind. Some random maps the spots to settle are extremely rare, evne then they still probably suck.

I do not mind wandering monsters or rare sudden appearances within your territory as long as they are not wandering and leaving their lairs empty. They also are equal opportunity wanders meaning they harass the AI jsut as much.

What is no fun is the overwhelming invulnerable killing machine monsters that appear during an innappropiate turn of the game. For example if I am playing an epic game I do not even want to see a dragon unless I spawn it with a quest until it is past turn 500. Then if it kicks my ass it is my own fault and not some random whim of the games AI.

Couldn't agree more.

I agree completely with seanw3, and perhaps also provide a "warden"-type improvement for cities as well?

I find the exploration in the early game much more interesting than defending from monsters, especially since tactical combat is rather pointless.

Anyway, it is a personal preference and I'm glad I can turn down monster density in the options. It makes it a whole different game imo, just as changing the pacing does.

Perhaps these options should be explained more clearly in the final release. Getting the right settings for the right player is vital for how much enjoyment they will have from the game.

since I last played in early .93, the monster AI is significantly better in all the areas you seem to mention.

 - They don't kite anywhere near as much as before. (less free loot)

 - The wake radius seems to only be one, giving far more freedom for scouts than before.

 - Strong and above monsters are never on your doorstep, but are more likely the further they are away from you.

 - Tough monsters SHOULD block expansion

And my fave ...

 - 'dispossessed' monsters are wrecking balls of fun that can be used offensively deep within AI territory.

And yes, I've had the odd rampaging Golem, even 5 stacks of ogre magi that followed me back from a failed raid on the swamps. Fighting them off to desperately hold a choke city (that I eventually lost) was the most exciting part of the game yet.

What may need some work is communicating what is happening in the game:

Why not have word spread if a previously known AI outpost or town has fallen? This would be an indicator that something's on the warpath, even possibly mention the offending unit if it was scary enough to feature in the rumour: "Dragons have wiped out a Kraxis outpost to the NorthEast!".

I can confirm what Frogboy has said, as I saw an obsidian golem smash an enemy sovereign and his empire. Still, I have also been the victim of a large wandering party of shrills (with an overpowering "king" shrill) that had wandered halfway across the map and randomly meandered through my city (destroying it). 

I think that the problem with the wandering monsters isn't so much that they discriminate more against the player, it's the fact that they are so unpredictable. Half the time, they attack the AI in the vicinity and the other half they sit motionless. Another problem is that the wandering bands of higher level monsters do not stick to their initial spawn vicinity. 

I've had problems with forest drakes that had wandered aimlessly around a quarter of the map (and this was a large map!). They were so unpredictable with their wander paths that I just could not let them live, so I dedicated an army to destroy them. 

Frogboy, you really need to stop doing this.

I know you're an AI coder. You know your code. You believe in it. But it is perceived as buggy and you take it personal instead of fixing the code or fixing the perception.

What we discuss here might be perception of bugs, not the bugs themselves. It is plain wrong approach to tell your customer and your beta tester that hi is blind or stupid, becuase he can't see the inner working and has a perception of 'monsters ignoring AI' or any other case.

You fight perception with facts, not with statements that are only going to antagonize sides. One side sees the code, but is unable to test all the possible test cases, the other sees the result but is unable to see/understand the code. If you force your will and the perception of buggy AI prevails in the released version, you'll damage your sales, because people will post on game pages, that they told you but you did nothing about it. At the least people stop telling you about bugs, which kinda kills the beta test reason. 

In this particular case, the solution to fight perception is to provide the players with information.

It's probably not that difficult to display on the monster stats window with more information

- it's current aggravation level (ie. how much more it will endure before lashing out measure up to 100% - but not rolled, replace it with certainity - if it aggravate to 100% it will lash back, it's impossible to aggravate the monster beyond 100%)

- it's current mood (ie. is it wandering aimlessly, is it seeking revenge, after hero, who claimed it's lair, is it destroying structures, outposts, cities, that encompassed it's lair, is it returing to lair, is it founding new lair, is it spawning, is it fleeing from threat)

It's probably not that difficult to display on the map (when hoveirng cursor over monster), what is it aggravated about (hero, city, nothing at all etc).

It's probably not that difficult to display on the map (when hovering cursor over monster) the aggravation zone (using the ZoC code but allowing overlaps) (along with information on chance and scope of possible aggravation, ie. passing weak army give +5%, passing pioneer +1%, neighbouring ZoC +1%, encompassing ZoC +10%.

It's probably all in the code, all you need is to make that information accessible. And it will prove why that dragon is standing near the AI city (hasn't been aggravated enough), or why the drake is killing your city (because your hero, destroyed it's lair and fled to it). Simple.