i agree that games are games. however i believe that both balance and realism can be served simultaneously.
peasants making looting impossible for smaller realms takes away just about the only way for small realms to wage war without relying on a larger ally.
they can't siege, their tos will probably be easily broken because they will take so long, the only thing they can do for the most part is hit and run attacks and raids, but they cant even do that effectively.