I once played a phenomenally successful game starting at Charlemagne as the Skjoldungs in Denmark and working my way up to a reformed Germanic Merchant republic empire. My realm included Sweden, Norway, most of Finland and Estonia, large parts of Northern Germany and Baltic Poland, England, Scotland, and Wales. I had numerous king-level feudal and king-mayoral vassals and a vast, contiguous, and well-developed trade network throughout the Baltic sea, and the North sea coast more or less from Tholen through Naumadal. I also had 40K troops in total, the greater majority of which were demesne and retinue. Basically I did it almost entirely through vast amounts of income from trade and merchant vassal income. I had almost no feudal taxation but I found myself almost never summoning feudal vassal troops anyway. The realm size existed solely as a means for increasing retinue size.
On the other hand, when I've played the ERE, I find it almost impossible to grow my empire and keep it stable without some increased level of feudal/viceregal taxation. The ERE is designed to be run through careful distribution and withdrawal of strategos appointments, and entitling too many lord mayors would mess that dynamic up completely. The ERE is also an expensive operation, however, and even with all of the well-built cities in Constantinople and fully operant Merchant Republic vassals in Amalfi and Cyprus I find I still need more money than would normally come from my strategoi if the feudal tax law were in the middle.
That's the beauty of the game - you have to know what playing style is appropriate for the circumstance.
