I also think that militia should have a disadvantage over regular armies, and that the player (and the AI) should should have to plan allocating troops to defend their cities.
Adding more defenders is one thing, since as a city grows so does the population, but arming them and armoring them seems like giving everyone free armies.
If cities were magically endowed with defenders that were capable of winning anything but a skirmish, then a critical part of the strategy (defence) would be eliminated, and conquest would be the only issue at hand.
If the AI is silly enough (BRAD !!!) to leave its cities defended only by their militia, then I should be able to steamroll over them with my well-armed and provisioned sovereign.
After all, I would like to be able to reproduce the sacking of Winterfell by Theon Greyjoy, and I very well can't do that if every city automatically has an army defending it...