Even without applying all of this, what would be much easier to change is the current realm size penalty bonus into a duchy size bonus.
The more regions are part of the duchy, from a certain amount onward(like 4 or 5), the bigger the realm penalty.
Realms that ignore duchies and maintain a single large duchy get more penalized then realms with many smaller duchies.
This would already make dukes more important, increase their role and increase their numbers.
This actually sounds like a really good first step, and it would be pretty straightforward to implement too.
