As AI they play an important role in flipping the Levant and Egypt away from Byzantium, who would be massively OP without this. And they can be made good for a human player, if rebalanced to allow the early and rapid expansion across the Magreb and also to allow the pursuit of better goals in the long term, like tech, culture, or capturing Constantinople. Also if you do have Egypt flip away from them, then you can challenge the human player to recover from this, whilst the AI will naturally collapse as Egypt arises with better units anyway.
I'm not sure what you are trying to say here. Why would the Fatimids have better soldiers than the Arab Abbasid armies? Anyway, since I doubt they will be made unplayable, the Arabs do need to be rebalanced and changed accordingly; especially if there is going to be an Egyptian civilization.
SOI is no better - why do the Ayyubids flip Egypt and Syria instead of spawning in Iraq and fighting their way to these provinces. But if you do that the game is no longer Rhye's and Fall, it just becomes standard Civ IV conquest.
You have a very bad tendency of saying things out of complete ignorance of the facts. I've had to refute your claims on multiple occasions now.
The Ayyubids spawn with Egypt and Syria, because by 1171, Salah ad-Din was already effectively the governor of Egypt. When he first came to Egypt with his Uncle Shirkuh, he was a nobody. When his uncle died, he filled his position, and continued to do with bidding of the Zengid Amirs of al-Jazira/Syria. It is only in 1171 that the last Fatimid Caliph dies, and Salah ad-Din defeats his Vizier, that Salah ad-Din is able to proclaim a new dynasty in Egypt AND in Syria, because of his family connections to the region. However his rule was constantly in doubt; he was simply an usurper, with little legitimacy.
So why have the Fatimids conquer North Africa? Because that is part of their miraculous rise to power. I highly recommend you start by reading the story of al-Mahdi and his missionary Abdul Shi'i. Needless to say, the story begins in 909, with the conquest of the Aghlabids and Rustamids (and raids into Morocco). It would allow the player more time to expand, and have the fun of conquering Egypt. If the AI/Player cannot conquer Egypt, then then Caliphate can stay in Ifriqiya + Sicily. But suffice it to say, the Fatimid Caliphate begins in 909, when al-Mahdi proclaims himself Caliph. So in 909, the Fatimids would spawn of Algeria, Tunisia and Libya (+Sicily ---> ONLY if there is a Muslim emirate present there). I don't see any chance for "bottling up".
For the UHVs, I would say they apply to the Egyptians as an umbrella term for the Fatamids, Ayyubids and Mamluks. With a focus on Europe, and fewer turns per year than SOI, it won't be feasible or good for gameplay to split them up further. Same way the Arabs in game are an umbrella term for the Rashidun, Umayyad and Abbasid Caliphates. Just have the name change over time, or dynamically.
I never said they should be "split up", but logically, because we have naming conventions we can represent different dynasties, such as the Fatimids, Ayyubids and Mamelukes. It does not need to be the Fatimids from 909-1700. Hence my UHV suggestions are generalized and logical for all of them:
1) Hold North Africa (up to Morocco), Egypt and the Levant by X date.
2) Have the highest trade income in the game by X date. OR Highest population OR Highest Income, something to represent the immense wealth of these states.
3) Ensure no Crusaders/Europeans in North Africa, Egypt or Levant by X date. ---> I forgot to add earlier, no Barbarians (ie. Turks, Mongols, or Ottomans).
basically challenging you to make a true Caliphate of your own.
What? I don't even know what this means. The Fatimids were Caliphs, through their descent to Fatima, the daughter of the Prophet, and the wife of Ali ibn Abi Talib (the 4th Rashidun Caliph). Salah ad-Din cannot be a Caliph because he is a 'low' born Kurd (Iranian), not an Arab. And the Mamelukes were a series of slave soldier dynasties that rotated power to different Mameluke households. At one point you had a Sultan called al-Mughli (the Mongol -- he had his origins in Central Asia). Anyway, by the time the Ottomans conquer Egypt in 1517 the title of Caliph was trivial, and was not picked up as a serious title until the very late 19th century (under Abdul Hamid II). After 1258, Khadim al-Haramain was a more important title (Protector of the Holy Places).