Have you ever considered adding a dynamic "Treaty of Tordesillas" mechanic? e.g. Papal bulls can "assign" a colonial region to a nation, with papal & political consequences for any other nation that colonizes in that region. They would end in 1650, when crusades do.
This seems like a really good idea. Although it should be a narrow and flexible as the actual historical treaty. I.e. the treaty was really only between Portugal and Spain. Other catholic powers ignored it completely. And it was partially ignored even by them.