It makes you expand at a boring, math-oriented pace. Go too slow and you waste infamy decay. Go too fast and... well, there's no reason to expand too fast, aside from rare, time-limited opportunities (racking up infamy just before Holy War goes away, for example).
Your complaints about CK2's system seem like they'd be relatively simple to tweak/fix, since I imagine it's just a question of adjusting the weightings for AI decision making.
Agree. CKII makes you work for your wars. I can't attack Ireland until I have some good reason for doing so, so I try to get a claim on one of their titles. A few decades later Hey Presto! I've got a claim to a duchy, or maybe the entirety of Ireland, assemble the troops and off we go!
In EUIII it's "Oh, since everyone's forgotten about my aggression thirty years ago, time for another generic war in which I easily defeat the enemy and then spend years reducing his forts, and then only claim a couple of more provinces despite having conquered and occupied the entire country. Ho-hum.".
One thing I'd like to see in EUIV, though, is that holding unassimilated territory should act to lower opinion of you no matter how long it is held. The Russians, Spanish, British, French - they all suffered for holding down other peoples. The more unassimilated territories you hold, the more negatively, all things being equal, other countries should see you.
VickyII also has a decent system - you have to manufacture your war goals. Although in some ways this can seem a bit generic (i.e., playing as the CSA I can manufacture a claim on any state in the USA, rather than on states in which I have an interest because e.g. there is a Dixie population - why the CSA public would buy the idea that they should annex Nebraska rather than Kentucky I don't know) it works well. The mathematics of the infamy counter, and the fact that my attempts to build a case for war are always exposed fairly quickly, are a bit of an immersion-breaker, but not nearly to the degree that they are in EUIII.
I think the Paradox crew have been through a learning process and am sure they'll come up with an even better system.