Well, the number of units that your empire will have at a given time will also be reduced what with limited resources and all that so you can rest assured that a global clusterf*ck of units is less likely. You'll be concentrated more on managing a smaller (but in many ways more valuable) set of units.
I think that 1UPT has very good omens coming up. Specially because it might ease the ground for the programmers to effectively set up a truly better AI. And clearly it also eases the mayor numbers of units which appear at some stages of a CIV IV game. Personally, I always thought CIV IV lacked for a higher maintenance cost of units as tech advances; this together with a slightly higher cost in unit production as from Infantry and on might be a proper solution to the matter (for excessive numbers, but not for the poor AI).
Still, I can foresee that 1UPT, together with all of it's so claimed virtues, may bring less strategy to some aspects of the combat system, particularly due to the reduced number of units & unit capacity.
I am very fond having to manage say 20-25 units within this frontage instead of 50-60, that is certainly good. But, if the number of units is terribly reduced, the cost of opportunity (marginal cost) of risking these much smaller (but in many ways more valuable) set of units in alternative missions, diverting attacks, exploring missions, etc, might be too high to go for. Thus reducing our options in regards to unit placement and usage. Maybe I put it too complicated, hope not.
As to unit capacity is concern I fear any civ might be almost compelled to have it's army at the maximum of it's capacity (i.e given capacity at a certain point) or it will be selling itself out if it doesn't; or even having very little operational range. Again, taking away the player's (and AI) choice about the size of the army (given the capacity). Compared to CIV IV where unit capacity is very flexible, specially around some broad margins (depends on the structure of your empire but still). I can't possibly know how the game will play out here, but it will be sad if it turns out that you are always working to keep your units at theirs maximum capacity.