Played king marathon game and 2-300 turns in whit v3, the ai settels cities but I found that pretty much all of their cities was about size 1-3 whit their capitals at around 6-7ish. This is on a giant earth map whit abundant resources. Other mods I allso use is strategic resources, faster build and slower reseach, improved water tiles, modern buildings (never made it to those) and mads tech tree. From what I can see from the screenshots other people posted it seems to be an isolated incident.
Edit: I was worng about the districts, it was only in their lower pop cities they only built holy sites, the few other cities they had whit 6-7 pop they allso built other districts