Off. There's a few abuses available to teams with vassals:
1. If it IS an AI, it gets a 50% discount to upgrades on all levels, allowing potential feeding of units + gold for discount power unit spam.
2. If diplo is on, this can allow a team that would otherwise not get the votes in time win.
3. Just leaving the option for peacevassal (one of the singular worst features in civ) open can allow a team that has given up to essentially permanent ally with someone OTHER than the invader (or potential invader). There's no mistake...peacevassal works very much like a PA.
4. Vassals on brings colonial maintenance into the equation, though I'm not sure that will be an issue.
If we do allow it, there need to be some very tight restrictions on what can be done.