Shattered armies, essentially being rewarded with invincibility and speed for losing... is nonsense.
Quite the opposite. As others have pointed out, it was difficult for an army of this time could force another one to do battle. These are huge provinces, and, compared to later periods in which actual fronts did exist, tiny armies.
Armies do rebuilt their morale and manpower rather quickly from a shattering defeat. But IMHO there should be lots of battles, particularly when one side is overmatched, that end very quickly with minimal morale and manpower losses on both sides. 10k armies in this period did not really go around wiping out 3k armies, because the 3k armies would never stick around to be mopped up.
I'd love to see a system in which battles between equally matched forces are decisive, but battles between poorly matched forces tend to result in the smaller force brushed out of the way, but able to fight another day. This would create a more realistic feel to campaigns -- small armies were simply more nimble and could preserve themselves, at the cost of being much less able to slow down the conquest of their territory.