In war that is not total, holding enemy territory not part of a war goal leads to rapid mounting of war exhaustion and infamy. Naval battles are fine, marching over the landscape to fight battles, just as fine. But take control, TAKE CONTROL of an area not pertinent to the conflict at hand? Uncivilised!
The tradeoff is that taking the territory means you force the opponent's war score up, especially if one of those territories is the capital. Nations with high jingoism or in wars of reunification (looking at YOU Prussia) don't have exhaustion increase as quickly. Infamy is still a thing... and a note about that in a bit.
Types of wars can mean different rates of increase. A territorial conflict should see war limited to the territory and any involvement on a wider scale comes at a huge cost. A conflict over a state with cores means not much infamy increase - it's still there - but neighbouring countries "understand".
Infamy should also be tracked separately for internal and external audiences . Yes, we have CON/MIL, but there are also lines that can be crossed in world affairs that cause the people to absolutely reject the regime and demand its change. At the same time, some nations may not give a whit what other nations think of them, overall, and carry on thinking that grabbing Elsass-Lothringen is the *right* thing to do, no matter what.
So this comes to a final part of this proposal - extend the crisis system to major powers, and allow nations to force resolutions of "questions" that arise over borders. Different government techs increase the speed/type of claims that can be made, and these claims need to be made prior to a corresponding DoW over such claims. For example, claims based on reunification grounds need to have discovery of nationalism. Prior to that, it's just not a thing.
The claim needs to be specific. No more forming a CB to get a state, any state: Pick the state and start cooking up the "question" that will be asked about it. And speaking of states, that's a HUGE grab - let players target a province at a time, less infamy, more chance their claim prevails.
So what would make a proper claim? Adjacency, number one. If Brazil tried to claim Bohemia without already owning Saxony or Silesia, for example, that's a non-starter. But if Brazil claims a slice of Venezuela along the Amazon border, OK, the world is listening. Next part, after nationalism is discovered, is a heavy weighting for the people of the region - are they part of your primary culture? If yes, to what extent? 10 Germans living in Nebraska is not much of a claim for Germany, relative to the much higher - and proximate - population of Germans in bordering nations. If the controlling nation shares the same primary culture, then that cancels out the nationalist claim. If a nation wants to create a puppet instead of taking the territory outright, then the question is of the majority culture in the province/state/region being a primary or accepted culture of the owning nation. If accepted, not much momentum behind that claim. If not accepted, then feel free to support the nationalist movement at the risk of your own nation's minorities starting to itch about doing the same sort of thing.
That above note would keep Russia and Austria firmly in the conservative camp, with exceptions for Ottoman lands. Germany, as well - none of those wants to see Poland on the map! The UK has a huge problem in Ireland waiting to explode, so it's not keen to redraw borders...
There would also be some recalculation for colonial matters, as they have less to do with nationalism and more to do with "errors" on the map.
So the claim is made and the nation now brings up the question of the map/nationalism error/situation. Phase 1 is direct nation-nation interaction: the asking nation sets an aggression level. The more aggressive, the more likely to get one's claim OR start a war. Imagine the USA - it tended to be very aggressive in its claims, which almost put it at war with the UK over parts of the Canadian border and did put it at war with Mexico over half that nation's territory. Low aggression means less likely to get the claim, but more likely that it will be resolved diplomatically.
The responding nation then chooses how to react to the question - it gets to see the claimed area and the aggression that goes with it. The response can be like for like - either a diplomatic solution or a counter-ultimatum. Or it can be unlike for like - a jingoist stance to scare off a less aggressive opponent or a conciliatory stance to hope to get a diplomatic solution that possibly is more toned down than the initial demand. That is Phase 2. Part of the calculation is the overall alliance status, value of the province, and such like considerations. If the province is itself part of that nation's accepted or primary cultures, then it is more likely to respond firmly. If the military scores of that nation and its allies are much lower than the demander, peaceful resolution will be preferred. If greater, then war looms over the issue.
Phase 3 is back in the court of the demanding nation. If the responder went with war, then the demander must either declare war within a short period of time or face a collapse in prestige and higher CON/MIL at home. It's this sort of consequence that should keep things like France demanding Cornwall out of the game - the AI would already have this sort of penalty calculated and then a risk analysis algorithm rules out anything where war is too likely for little or no gain. If the responder went with peace, then there are three options - war is an option for a high aggressive stance, but with massive infamy and that nation goes it alone as all its alliances are dropped. It could choose peace, starting a conference with the responder nation. Finally, it could choose an international conference. If other nations are interested, then there is a chance this produces a better outcome than the straight negotiations.
Peaceful negotiations can be influenced by the "rightfulness" of the claim. Small claims, high prestige, stronger alliances, all these contribute to the rightfulness of the claim. On the table are things such as the territory in question, possible other colonies to balance out claims, non-aggression pacts, demilitarization of borders, cash transactions. If it's a GP conference, more GPs on your side mean more "rightfulness" and increased likelihood of getting the claim without having to make other concessions. Another possible peaceful outcome is the exchange of "villages and acres" - a white peace where the claim is settled, and permanently. The demander is not allowed to go there again and cannot demand against that responder again for a period of years.
Ultimately, it's up to the responder or the biggest GP backing the responder on whether or not to accept the negotiations. If not, there is then a chance for war. The demanding nation either declares war or suffers a massive loss in prestige, CON, and MIL. If the demander declares war, then all other GPs go to war or suffer like penalties.
So, an example could be where Bolivia wants a neighbouring province of Paraguay. Neither nation has allies, and Bolivia has a slightly higher prestige and better overall GP relations than Paraguay. Bolivia demands aggressively, as it has a larger army. Paraguay responds peacefully. Bolivia chooses peaceful resolution and, due to higher military score, gets the province after agreeing to a non-aggression pact for 20 years - it may not attack or claim against Paraguay during that time. Paraguay is now motivated to get an alliance with UK or Germany...
Another example: Both Brazil and Peru tried to colonize Amazonas. Brazil demands peacefully, Peru responds peacefully - Brazil offers money for Amazonas, Peru accepts. Both nations should have a bump in prestige and an increase in relations for such admirable diplomacy. This does also give me an idea of nations offering to make offers to settle borders as they are - the benefit is a bump in prestige along with a prohibition regarding future claims, like the treaty that fixed the border between the USA and Canada. Since then, the USA has not reached for Vancouver and Canada has made no claim to Seattle.
A final example: Serbia demands Serb-populated territory from the Ottoman Empire and it's after Nationalism is discovered. Serbia has an alliance with Russia. Austria and Germany both have low relations with the Ottomans, France and UK are busy racing each other for Africa, and the Ottomans are not a GP. Serbia demands aggressively, Ottomans respond peacefully. Serbia chooses a GP conference. Russia lines up behind Serbia, as do Austria and Germany. UK and France support Serbia, but with a slight prestige penalty so that they won't be asked to be involved in any war that breaks out - prestige sacrificed as insurance is a good use of the stuff, I think. Put on the table are Serb demands for Southern Serbia and Macedonia. Ottomans refuse. War breaks out with Russia and Austria defeating Ottoman armies and the Serbs taking slices of its demands. Ottomans come to the peace table and agree to Serb demands and pay reparations to Russia and Austria and Germany, commensurate with those nations' global standing and war involvement. If the Ottomans don't have enough cash on hand, they can offer corresponding concessions, such as getting sphered, border fixing, the transfer of a province here or there, freeing Bulgaria, things like that.