Txurce
Deity
Diplomacy is an exception, with backstabs being frequent.
There are no exceptions. An example was raised, which happens to counter your argument. Frequent backstabs aside, players often side with the big player against the smaller, working against what you described earlier as obvious self-interest. People often think short-term, even if to their eventual loss. To go further, personalities become involved, and people often act in a downright irrational manner. This is part of what makes Diplomacy both so immersive and so frustrating. In these regards, the AI is no worse.