It is imho, the biggest weakness of the game in the end game.
Essentially, the game does not want a winner, you the player HAS to go out and win it for yourself or your faction.
You can see it too, you go out conquer half the map, wipe out half the other factions and what happens? Most of your lords leave your faction ! Due to the loss of rep from awarding fiefs etc. In my current game, i spend most of my time placating my Lords and the other half shopping for stuff so i can gift lords to keep the rep up. Eventually i know i will just go, screw this and just let them leave my faction and then imprison the whole lot of them.
they are quite useless anyway, my main rival has 3 times the lords but without fiefs they are pathetic small groups of 20-40 mens whom i can mow down en mass . And those are all either jumping from 1 faction to another or simply disappearing from Calradia. The arbitary loss of rep in fief awarding just means that as King i just don't award the fiefs out. That way everyone remains happy and who cares if the enemy retake the fief, it takes them so long to do so, u can ride behind take 3 times the fiefs and return to defend the undefended fief.
sadly i suspect this is meant to be, i am hoping for a mod that fixes these issues and provides a challenging end game.
fact is 1. the AI is dumb regarding onfield strat
2. the game punishes you for being successful ie tax inefficiency, rep loss from fief awards etc
3. you can win the game at the hardest difficulty with just yourself and 250 odd top tier troops.