Since cores take admin to set up, I like my abstraction that they represent administrative control. Reconquering a core means you just go in and put your rule back in place where it once existed, relatively seamlessly. Dip points from annexing are just bring the foreign administration into line with your own. Core cost reduction comes from the ability to more efficiently set up new administrations, and claims allow you to get officials lined up and therefore save time and effort in the setup once you take control.
Obviously there is no perfect analogy because the whole coring system is completely at odds with reality and clearly more for gameplay and balance, but that's the closest I have gotten.
What happens in your games longer-term? In mine, Granada rarely went to one nation; someone would grab its outliers and then another would take the capital. I often saw them join a war on Morocco's side, with Portugal warleading, and Castile occupying most or all. They would then separate peace out of the war; with no core, Portugal rarely gave them to Castile, but would instead take anything they occupied for themselves. Meanwhile, afterwards, Aragon might come in and scoop it up. I also, funny enough, a couple times saw them lose land to Africans in internal wars - Algeria vs all ones for instance - where the AI would go park on their Iberian turf rather than fight at home, because reasons.
All of this isn't so bad, except that the result of it I often experienced was Portugal owning part of Granada led to hurt feelings and division on the peninsula, which led to France. Not always, and hell let's be fair even with cores sometimes France marches south, this just really seemed to escalate it to common occurrence.