But if he likes me so much (since I give him all holdings in the Duchy) he's not likely to rebel, so it doesn't matter if he's powerful. As for only selecting the best people for each holding, well who has the time to micro-manage that? I usually end up with a vast Empire, so it really doesn't matter to me at all who is the count of Milan or what his stats are, so long as I keep on top of the vassal kings directly under me.
It depends on who you're playing as . As a Christian it may be okay to just let it go, as a Muslim...no. You have to manually go through and revoke every single title from anyone not of your religion and culture and give it to someone with learning and stewardship or the revolts will become a persistent irritant. On the flip side, once done your realm will be far more stable than any Christian's due to your succession law and your (hopefully efficient) eugenics program.