So yeah, i have been thinking about this issue a bit lately, this is not just Bannerlord issue, but it got exacerbated because the AI is not dumb anymore. One can imagine, if this kingdoms and empires existed for generations, that there is a pretty strong stalemate between them. Even in Warband the game would become unstable by day 1000 unless you ounded your own kingdom, constant wars would start lords bouncing from kingdom to kingdom and eventually leave the realm. Issue in both Warband and Bannerlord (though in Bannerlord it seems more pronounced) is that kingdoms and especially empires don't just consist of 3 towns and 6 castles, even CK2 that has extensive map with hundreds of territories and multiple holdings in each one could not cover all of it. Truth is even small kingdoms had dozens if not hundreds of fortifications of different size, and those fortifications served as speedbumps to prevent the exact sort of situation that happens in Bannerlord, with one faction gaining an advantage and immediately proceeding to roll over any opposition it may have had. here was also the issue of campaign season, you can't campaign during winter(it would be suicide) or during harvesting or planting season, at best you get 3 months of campaigning per year.
So how can this issues be remedied? Apart from expanding each faction tenfold and adding heavy attrition penalties for the attacker, the only real solution is to introduce artificial checks on AI expansion. AI not pressing it's advantage may be unrealistic, but in real life such army would more often then not be prevented from pressing the advantage due to factors that just don't come into play in Bannerlord
So how can this issues be remedied? Apart from expanding each faction tenfold and adding heavy attrition penalties for the attacker, the only real solution is to introduce artificial checks on AI expansion. AI not pressing it's advantage may be unrealistic, but in real life such army would more often then not be prevented from pressing the advantage due to factors that just don't come into play in Bannerlord