This game is getting better and better. Especially with 1.2. My last game I almost quit because it seemed i couldn't possibly fend off 3 civs bearing down on me... (mostly because my empire was spread thin because i started in a corner)
However. What i've noticed is the AI doesn't seem to put enough effort into building battle group fleets. By this I mean all fighters/battleships. It seems like all you have to do is get the match ups right against maybe 5-10 of these fleets, and the rest of his navy is transports and escorts. (which go up like kindeling by the dozens) (And if you're behind, you're best bet is to build a military starbase where you are going to fight, and try to take out these fleets.)
After you wipe out the AI's transports it is in a hopeless situation, because it's economy is wrecked (loss of population) and you can start bringing your forces to bear.
What I'd love to see from the AI, is get away from building so many escorts. (or any at all) Best would be to "own" a sector of space by military might, clean out each planets defenses, and send in fast transports that meet up with the battle fleets for protection. This would provide protection for the transports, and allow the transports to get there faster. (not limited by escorts speed)
Also, sending hords of transports after 1 unprotected planet deep in enemy territory (even escorted), is silly. The AI should be able to build 2-3 very fast transports to make an "attempt" at grabing an unprotected planet. But focusing 4-5 fleets of transports/escorts is just a waste. (esp after the first one gets decimated)
I am currently playing at crippling level, don't yet want to give the AI too much money...
I think one more or two more rounds of AI tweaking and this game will be incredible. I'd personally love to have go back to painfull or challenging.