Frogboy, care to explain the difference? I've got a few ideas as to what the differences could be, but I was wondering what your target is.
For the base of my examples, let's consider races A, B, and C, where A and B have a treaty and B and C have a treaty. Given the current state of alliances, a war between myself and A, even if there's no combat going on, will trigger both alliances, which is how we wind up with entire galaxies at war. I've had war declared on me, then been at war with 4 more races the next turn due to a chain of alliances.
So, would mutual defense treaties be:
1) treaties that only trigger if combat occurs. So, if A attacks one of my ships, the treaty with B is triggered, but the one between B and C won't trigger until there's combat between B and myself.
2) treaties that only trigger if *I* attack. I can sit and defend all day long, but until I make an aggressive move, the treaty between A and B doesn't trigger, and likewise, the treaty between B and C doesn't trigger until I make an offensive move against B.
3) as treaties that trigger depending on who declared war on who. If A declares war on me, then it's not defensive, so the treaty wouldn't trigger.
Option 1 is the least abusable, but also the most likely to get us back into big wars because of chains of treaties. It would still be much better than current alliances.
Option 2 would be my choice, though it most suits my play style, so that may be a factor of why I like it. It can be abused by carefully making sure that you're only attacking player A until player A is no longer a factor. You'll be getting hit by two races at a time, but you can work your way all the way up the chain without bringing the entire chain into the war.
Option 3 is also abusable, as for me, at least, I don't have problems coercing the AI to declare war on me. At least not the first time. After I build up a military big enough to swat the first AI, I might have problems getting the second one to declare war.