I've tried two different methods. The first time (and the campaign I'm still currently playing) I decided to go the war route. I took out a couple of loans, bought up a heap of mercs, and attacked England, got four provinces out of it. A few years later England counterattacked, and I took out another two or three loans and grabbed another four provinces.
I decided to attack again as soon as the truce expired, but this war went very badly because England by then was still richer, better teched and more powerful than me. It took me four reloads before I was able to get enough experience to defeat a very tough England in battle, but once I learned how to fight I did very well. Took another four provinces, then fought another war later and took the final five provinces. England is now my vassal and has only London and Calais as its two provinces. I'd like to diploannex, but since France and Burgundy have cores on Calais, I don't want to do that until I can risk war with them.
So you can beat England, but expect a tough struggle and multiple wars. It took me 64 years of struggle and 25% inflation to win, but I'm now the number one country in the world with the biggest income and with inflation under 20%, so things are going well.
In my other campaign, I tried going the peaceful trade route, it was a big mistake because a few years into the campaign, England declared war and rolled me with ease. If you want to try and play the Scots as a peaceful trading nation, at least be sure to honour your alliance with France even if it costs you a stack of stability points, because without alliances with other majors Scotland is I guess just too tempting a target for the English.
