Lots of good ideas here. My own thoughts (partially based on things already mentioned above) would be for something like following:
1. The Pope declares his intentions to launch a crusade for the holdings of ruler X in kingdom Y. This causes a narrative event for all good Catholics and anyone near the target, letting them know that they should prepare to crusade, to defend against the crusade, or to either stay out of the way or try to exploit the situation.
2. All Catholic rulers get to pledge their support in one or more of the following ways:
- Active participation. You intend to march to the crusade target with all the forces you can muster. This mean you will be expected to join the crusade as soon as it starts, but it is also the only way to (possibly) gain the crusade target. You will not be able to start any wars until the crusade is over (and will also be blocked from factions and plots that might lead to wars), but other Catholic rulers attacking you risk the wrath of the Pope (including excommunication).
- Pledge men/ships. The targeted demesne provinces will have their levies and available ships lowered by 25/50/75 % (depending on how big a contribution you decide upon) as soon as the crusade starts, and the regen rate is reduced by a large amount as well until the end of the crusade. This is mutually exclusive to active participation.
- Send commanders. Ask your courtiers to go crusading as part of the official crusader host. Zealous, Ambitious, Brave, and high martial courtiers are likely to accept. These guys get disinherited (for the time being; more on that below), so heirs are likely to refuse to go crusading.
- Donate money. Send X years of income to the Pope for safekeeping that will be spent on the crusade and given to the eventual king of the crusader kingdom (though a bad Pope might not pass it on).
During this phase, the target should do its best to end all offensive wars and to start preparing to defend himself. Vassals of the same religion (barring those with sympathy towards the attacker's religion or that have the same religion as the attacker) should get less unruly, and same-religion rulers should get more reluctant to attack them.
3. 2-5 years after the Pope made his declaration, a leader is selected, with preference given to powerful participants, but a commander with high martial/piety/prestige, good dynastic ties, or high Papal approval may also be picked. The leader then gets a temporary adventurer title (if he isn't landed already) automatically declares war on the target and all those who have pledged their full support get called in. All assigned commanders are transferred to the leader's court and fleets/event troops are spawned in the provinces where levies/ships have been assigned to the crusade, granted directly to the crusade leader.
Anyone that is actively participating has to appoint a regent, as overseeing a distant war and managing affairs at home won't work at the same time. Just hope that your kingdom isn't too badly damaged while you are off crusading...
4. On the way to the target, random events can happen to the commanders of the various armies. Some are good (more crusaders join the cause, a heretic province is scared by the sight of the crisading host and converts back, etc.), some are neutral (you improve a skill due to meeting a high-skill ruler, your men carch some robbers for prestige, etc.), some are bad (your men burn down a church, you offend a local ruler, etc.) and some are terribly bad (a neutral heathen joins the war against you, the leader of the crusade decides to sack Constantinople, etc.). The last kind mentioned can lead to the crusade being aborted, commanders and troops deserting in disgust, and the leader of the crusade attacking a friendly(ish) ruler, costing the religion a lot of MA and obviously risking excommunication and things like that.
Sending a high-martial Ambitious commander can thus backfire spectacularly, but only sending poor conmanders obviously can lead to the crusade failing. You may also make lifelong friends or rivals during the crusade, so going yourself can be good or bad.
5. On victory, the crusade leader gains all occupied land (if he isn't already landed) in the target kingdom (and possibly occupied land nearby if he is Ambitious). He also gets all duchy titles he has control of (unless they are held by a Catholic) and the kingdom (unless it is held by a friendly ruler). He then hands out counties and separate castles to his subcommanders (based on opinion and his traits; a greedy guy will keep a larger demesne). Most of the crusader host stands down (though some event troops are kept), and many of the commanders who haven't been landed return home. The capital province of the commander (and potentially a few random provinces) switch religion (and have a small chance to switch culture) to simulate crusaders settling the area. If the leader isn't overly ambitious (and has a reasonable army), he swears fealty to his de jure liege if said liege is a Catholic. Otherwise, he may claim the kingdom and try to take it later on.
A landed participant who isn't the official leader might try to get control of the land instead, if he has sufficient piety/prestige/military power, which most definitelt will upset the leader and may lead to fighting if neither side backs down.
6. Landed crusade leaders get to choose between abdicating from their original title to rule the crusader state (with the throne going to the most liked dynasty member (that isn't from their immediate family) or another family entirely (if it is an elective title or there are no suitable candidates) and their descendants also abdicating (to keep the kingdoms from merging a generation or two down the line)), to appoint a ruler from among the commanders of the crusade (with immediate descendants and descendants of their primary heir blocked), to appoint an unlanded dynasty member (that cannot be their direct descendant), or to keep both titles, which hurts MA and Papal opinion as you are using the crusade as a land grab instead of to save the souls of the heathens/to smite the heretics/to protect some holy sites/etc.; though an exception is made if you have holdings nearby to prevent silly outcomes like the king of Castile not being able to keep Andalusia without upsetting the Pope.
If the Pope likes the leader and isn't Wicked or Greedy, he passes along most of the donated money he got earlier. If you have upset the Pope (by e.g. burning lots of churches, souring relations with neutral rulers, or grabbing land), don't expect to see most of that money either.
7. While the original crusader king (and possibly his heir) lives, no titles can enter or leave the crusader kingdom through inheritance (unless the king kept the old titles as well), though heirs to foreign thrones get the chance to abdicate from their crusader titles to return home. After that, it is possible to inherit land normally once more (laws permitting).
The above could probably be adapted for other religions as well, though some heads (e.g. the Fylkir) might be more justified in keeping land for themselves or more forgiving if land is taken in addition to already owned land.
Additionally, I would suggest that targets should be picked based on the following criteria (in no particular order) if all titles with an assigned crusade weight have been taken:
- Proximity to a Catholic realm.
- Proximity to a holy site or important city (e.g. the Pentarchy seats).
- Population (number of holdings and a higher priority for feudal land than steppes or tribal land).
- Danger the target poses to the Christian world (e.g. target the massive Persian empire near Jerusalem before the kingdom of Mali).
- Presence of Christians in said land.