Nomad agitation only happens when non-nomads conquer a province from nomads, I thought? Not sure how it would differ from the current system in that regard, afaik you can already get the issue of "nomads conquer a tribal province, tribe conquers it back and gets agitation".But then it would cause nomadic agitation in any tribal province which changed hands (this is already a problem in 'feudal->tribal' mode where theocracies can sometime end up with only a temple holding and spawn random nomads in western europe if the province is conquered?).
Though personally I wouldn't be sad to see Nomad agitation go.
If I'm reading the wiki right, the conditions for nomad agitation are specifically the lack of castle or city holdings, not merely the number of holdings, so I don't know that that define has any effect on it. The comment in defines.lua implies that it only affects whether vassal clans can demand the province.