Swearing fealty early on is probably a good idea early on in the game with regard to having any hope of surviving. However, despite the fact you're de jure ERE, I'd look north to the HRE instead. It's easy to keep the crown laws below medium (I've succeeded in every single faction plot to keep CA down to limited I've ever executed) and it leaves you able to fight vassals in and around Italy, mopping up some easy and potentially rich lands in the process. Of course, being based in the Italian peninsula, it makes sense for you to try to fabricate claims on Genoa and Venezia given the huge pile of gold those two counties are usually sat on. However, your play style really should depend on what you're looking to get out of the game long-term.