- Vassal States: On - probably never used but why leave it out?
Because Vassals are broken between human players. For instance, human players often cannot break free from being a vassal even after the conditions have been satisfied for them to do so.
- Difficulty Level: Low (Noble/Prince), Medium (Monarch/Emperor) Anything not high is fine with me. Primarily driven by a preference for higher happy limits, to be honest I have no idea what other effects difficulty has.
Actually difficulty level no longer affects happiness, since BTS. Here is a (complete, AFAIK) list of things which ARE affected by difficulty level in a multiplayer game:
General:
- Research times (beakers per tech get more on higher levels)
- Hut probabilities (more likely friendly on lower levels, quite likely hostile on higher levels)
- Number of units that do not cost GPT (fewer as the difficulty goes up)
- City maintenance and civic costs (higher on higher difficulty levels)
- Inflation rate (higher on higher difficulty levels, costing you more gold)
Barbarians:
- Win probabilities vs barbs (bonus + free wins on lower levels, no bonus or free wins on higher levels)
- Barb city spawn rates (more barb cities pop up on higher levels)
- Barb unit spawn rates (more barbs on higher levels)
- Barb city garrisons (more troops in barb cities on higher levels)
- Animal attack probabilities (75% on Noble ranging up to 100% for Deity)
- Number of turns before barbarians start appearing (earlier on higher difficulty levels)
- Number of turns before barb cities start appearing (earlier on higher difficulty levels)
That's the complete list for multiplayer (as far as I know). There are also a whole lot of factors that are applied to the AI, but since there are no AI civs in this game, they're not relevant. So the above factors are the only ones which difficulty level affects. As you can see, there are only four main overall changes as you up the difficulty level in an all-human multiplayer game:
1. Stronger barbarians
2. Higher GPT drain due to higher maintenance/civic/inflation/unit costs
3. Huts more hostile
4. Research times longer
That's about it. In a single player game you also have the major factor that the AI get a whole bunch of bonuses (in about 20 different categories!), but they're not relevant here.
Below is the sheet I got this info from, if anyone's interested. The numbers may be slightly outdated since it was released, but the actual categories of things that change should be the same.