Got a bug, and an unrelated comment.

I got the escort a nobleman quest, but the estate was placed one tile outside another nation.  As you can imagine, the border of that nation expanded beyond the estate.  Thinking the game might possibly see the nobleman as some sort of border jumping unit, I tried to cross the border with just the nobleman and was told to start a war, or leave.  This made the quest impossible to finish.

The most obvious solution would be to have a minimum distance that the estate can spawn from a city that isn't yours, but that might cause some placement issues.

The other one - I'm sure this has been mentioned, but with Yithril starting the game with 'Tools of War' equipment and a speed buff to all soldiers makes rushing easy.  Pop one goodie hut for some metal, make two fully armored axe/shield infantry and equip your hero and you have a 3 man wrecking crew that is all but impossible to kill.  The only current counter is for the AI to research 'Tools of war' immediately and crank out an army of their own.

Possible solution - Change Yithril's advantage to something that isn't "I win", make it so you can't get metal from goodie huts, make the total armor given from full padded + wood shield something other than 6.  One of these soldiers can handle 3 basic peasant units on its own, it would be even more lopsided if I had paid for the dagger to get the extra dodge.