I still want to see a middle ground - regions that can function properly without knights, but something extra added in that makes it worth while for knights and lords to have an Oath exchanged between them. We're lacking that kind of positive incentive - all we have are "your regions don't work right" warnings and half-mangled realms as a result.
I agree we lack the positive incentive, but I think you have to reword that phrase: "regions that can function properly without knights" to "regions that can function poorly without knights" (but at least function at all, which doesn't happen today). And you know why? There were lots of lords around whom, even after estate requirements just showed up, didn't bother with hiring knights (or doing anything else about their regions, for that matter). Being a lord was just about getting a bit more gold a week than your regular knight. Surely, we don't have the problem of excess knights now, after Dwilight and all, but there will still be lords who'll ignore their regions if the game allows them to.
So, I'm totally in favor of offering the carrot, but for those horses who don't care about the carrot there must still be some sort of whip to push them from behind.
