Had an excellent game last night (that I intend to finish tonight) where the galaxy fairly naturally fragmented into factions.
I did find it was pretty easy to 'pick my battles'; I might have had to go to war with one faction to keep another happy (rather than, previously, stay friends with everyone) but I could choose to side with the stronger faction pretty easily. That way I was rarely in any real danger.
Still, I've been enjoying these improvements.