Txurce
Deity
Well, but if I burst into your territory with a Battleship and sink a ship or two, you'll soon be able to fight back and either sink my Battleship or force it to run away and heal. With a Sub, you're simply out of luck if you have more units than you have coastal cities. Good luck starting your navy from scratch.
Really, you don't think it's a problem that City-States just destroy your Settlers? Even if you're Friends or Allies with them?
I pretty much never lose a ship to the AI, so I can't imagine losing a Battleship to Frigates, for example. And I do think you should have an edge with that sort of research lead, just as you do with Fighters.
As for the CS question... no, I think it's fair. We don't automatically give back workers to our allies, either.