A little of column A and a little of column B.
You can't have stictly B in AI maps and it be fun. Everyone would have to have the same start and be equally distant from each other and a bunch of other impossible setups. A little from column A makes it fun. Winning or losing mostly from B is what makes it rewarding. Though we all read Sid's test on what people view as "balanced" odds. So maybe we like a little from C as well.
A little of A and a little of B (and a little of C to cover systematic deficiencies in A as needed) is important for fun games of civ. You SHOULD blow out the computer when you're playing on a difficulty "too low" for you (scare quotes because individuals might have the most fun playing on difficulties lower than they could win on). There should be randomness to the maps and to the combat, and there should be those games where everything goes right for a civ and they get a huge edge just from that.
But if that's happening a lot, the game gets boring. If combat randomness and map randomness is decisive all the time, it will swamp skill and you'll feel like you're just winning/losing at random. If the AI is much worse than extremely good players even on the highest levels (and doesn't cheat to compensate; I'm sympathetic to the idea that programming a legitimately top-tier AI for Civ might be much too expensive to be commercially viable), then the game quickly becomes boring because it's no challenge.
You should have games where you just dominate, but when you're playing at the right difficulty level, they should be very rare.
By the way, on Civ IV's maintenance mechanic - this is only a "punish the top, reward the bottom" mechanic if you view land area as the measure of a civilization's expected power. It exists in Civ IV not to keep the weakest Civ relevant but to make it so that other factors besides simple land area calculations are important for figuring out which Civs are strongest and which are weakest. You also have to factor in important resources, a strong diplomatic position and development level of cities.