C- or C overall, I can't decide.
It expands and grabs territory efficiently, is passable for city placement, and actively techs, does research agreements, and all that jazz. It is also capable of planning and launching a very destructive and reasonably well played attack when it's the one declaring war - basically, when it does so on its terms. I've been hit by very nasty attacks with infantry type units fronting for archers with cavalry running around for cleanup and backfield disruption. It will also actively pursue victory conditions if you're not paying attention to them - which can be a problem on the huge maps I prefer, as Napoleon across the map might just pull out a culture victory on me.
That being said, it does not handle a good number of things well at all. It doesn't adapt to various situations when embarking units - it'll embark units in positions prone to your naval units or ranged units and won't adapt when it becomes apparent that the units are prone. It also tends to overcommit horse units which, while being devastating when it has a significant military advantage as it'll wipe out reinforcements, it just makes for a lot of easy kills when a player has the units to follow up on and kill poorly defended horses.
What's more, once its initial forces are destroyed, it has a poor understanding (as much as you can say AI understands) of how to effectively fall back and conglomerate a defensive position and counterattack. In fairness, no Civ AI has ever been good at this, but in previous Civs it made less difference because units were cheaper and there were far more of them to take out, so an initial major loss usually still left the AI with substantial forces left behind - and slavery/drafting allowed the AI to easily pick up the slack. Though, I was somewhat impressed fighting Mongolia today, after he captured one of my cities and our forces were both decimated to 20% or less, the bugger bought walls and a castle in the city he'd just captured from me and had a few keshiks cycling in and out of it whenever I tried to capture it, effectively harassing my force of two trebs and four longswords and forcing me to move to another front in order to continue the war effectively.
I get the distinct feeling that the AI has been effectively programmed to operate in a limited set of circumstances, and in those circumstances, which do occur frequently, it does its job ranging between adequately and well. As soon as it breaks out of those particular scenarios it is effectively programmed in, it utterly falls apart. I see examples of both in almost every game I play, and until they get it to the point of it being a rarity that the AI falls apart, I'll give it a bare passing grade since I am both at times challenged and impressed and at times unchallenged and unimpressed in any given game.
As for diplomacy and trade.. Trade it is simple - if it likes you, it'll trade fairly, if it doesn't, it either won't trade or try and rip you off. I'd give it a B- in this regard - functional, but simple. And for diplomacy? Meh, it's tough to say. It knows how to hate you, to find excuses to hate you, and I'm just starting to get a feel for making an ally and sticking with them. I'd give it a C- since the diplomacy seems stacked towards pecking parties, group denouncements, and group war declarations - for relatively small infractions. Needs more ways a player can actively work towards to make, keep, and motivate/manipulate allies.
