So, is there subtle diplomacy in this game or are we condemned to betray everyone?
You must use diplomacy in this game. To form Plots, it's essential .. with multiple other clans. There's not many direct Diplomatic options, however. Not like you're used to in other EU games. Much of the basic diplo footwork is done via marriages and betrothals. You can also get a slow bit more via sending your Minister of Ceremonies to improve relations with one, but that would take away from him building up your village economies. The only directly relation-improving diplo option is giving a Gift of Money, and that will only give you a small relations bonus for a short period of time.
Overall, relations with every other clan is rather poor and always will be. You just work to temporarily raise them via marriages, exchange of hostages, etc. in order to get a short-term plot against another clan carried out or to keep them off your back, temporarily. Don't ever expect to have a big friendly alliance with other clans for more than the lifetime of whomever has a connection with them. It's pretty cutthroat, but that's one thing that sets it apart and gives it's own flavor.