At the risk of repeating myself (I'm pretty sure I mentioned some of this stuff elsewhere in the Civ4 thread) my ideas on seas/oceans are:
1. Fishing should be done by a fishing fleet. This fleet should have to go where the fish are (like George's Banks). The civ or city (whichever way is feasable for Firaxis) would receive the food and money based on the fleet being able to establish a colony where the fish are. The fisheries should be attackable--but only with an act of war! Wars were, actually, proposed over fishing rights. The fishing colonies should be tradeable (to reflect wartime gains, etc) and capturable.
2. Submarines need to be invisible. Currently submarines, destroyers, nuke subs and (possibly) cruisers/aegis cruisers can see them. This makes subs almost useless (except as stealth attackers). Submarines should have a special bombard capability. When a hostile ship enters a sub's square the sub should get one free bombard and then escape to an unoccupied, neighboring square. If the hostile ship enters the square successfully and follows to the square that the sub jumped to then the sub is 'seen' and attackable in the routine way.
2.a. Subs can wolfpack in a square, after the first jumps, if a hostile ship still attempts to enter the square, the next sub will attack it and 'jump'.
2.b. A new unit, the ASW plane, will be able to spot submarines. The only way it will spot them is by doing recon on the exact square that contains the sub(s).
2.c. Subs should have at least enough firepower with their bombard to sink a regular ship (especially a transport). In other words, whichever way bombard is done, the sub needs to be able to sink its prey. In Civ3 terms this means that the sub would need to be able to cause 3hp of damage and must have lethal bombard. (What the bombing strength should be is play-testable).
2d. If a destroyer is the target (or accompanying the target) of a sub bombard and the fleet moves into the square (i.e. there are no more subs/surface ships in the square) the destroyer (and only a destroyer!) should be able to see where the sub went. If an ASW is then sent to the square, other units would also see the sub. The sub would be able to be attacked by the destroyer, however, the destroyer would not know if there were hidden submarines in the square that the 'seen' sub jumped to, so this would be a potential risk.
2e. Submarines should be invulnerable to shore bombardment.
3. Ships need to move much faster in the modern age. One suggestion is to make all water tiles cost 2 and then make certain ships (as the tech gets better) ignore terrain costs. This is currently doable in the editor, but should be standard practice.
4. All non-nuke, non-sail ships should need resupply of fuel. If the US Pacific fleet had been stationed in San Diego instead of Pearl Harbor, the Japanese might never have attacked. If they did attack, they would have expected to lose a lot of ships to US bombers stationed in other cities. In addition, although some excursions were sent to the Japanese home islands early (the Doolitle raid is a prime example), very few were sent before closer islands were held. Sending along a fuel ship is a risky proposition.
In this light, fuel ships should be created, and if they are sunk, all ships relying on the ship should have a limited movement before they stop and have to be refueled (by another fuel ship or in port).
5. Aircraft must, I SAY MUST, be able to intercept ships. Basically aircraft and subs need a readiness flag.
a. Peace: Unit is seen if another civ tries to move into its square.
b. Limited engagement: attack only known hostile forces. Subs would be unseen unless a unit tried to move into their square. If the moving ship is hostile (i.e. the owning country is at war with the sub's nation) then the sub attacks with the bombard. If the moving ship is friendly or neutral the sub would be 'seen' by this nation. There is a 10% chance that a submarine will mistake a neutral ship for a hostile one and attack it by mistake. This will cause the AI owning nations to have a 10 or 20 turn attitude hit (which could cause a DOW).
c. Unrestricted Submarine Warfare: attack any non-friendly/allied ship. The sub will attack any ship that is not of an allied nation.
6. For aircraft: similar to sub warfare except that the chance of attacking a neutral in b above would be very small or non-existant (maybe 1%).
a. Aircraft that are set for interception would have a %chance to find an enemy fleet sailing into their waters (note that enemy fleet in b above is defined as not at war at the beginning of the turn). If an enemy fleet is found all aircraft that are set for intercept will attack the enemy fleet. If the enemy have aircraft set for "Air Superiority" they will try to destroy those trying for the fleet.
b. If the fleet survives the first onslaught and continues on, the same thing happens in the next square. If spotted, the fleet is again attacked by all intercepting aircraft.
This continues until either the fleet is gone, the intercepting aircraft are gone, or the fleet is no longer moving in range of the aircraft.
c. "Air superiority" needs to be changed so that counter-interception is taken into account. In other words, if A is planning an attack on B, A can designate (in his turn) some air units for "Air superiority". Next, A sends aircraft/ships into B's interception range. If B has set up stuff for "air superiority" or "interception" then A's air superiority and B's air superiority and interceptors fight it out. After all this is done, then a. and b. above commence.
d. Range on an aircraft carrier would be less than on a land base. Otherwise, the interception, air superiority, and such will all be the same.
e. No trade can be done with neutrals doing the shipping if Unrestricted Sub Warfare (or its equivalent with aircraft) is declared.
7. Merchant marine/maritime trade systems must exist. Probably the best way to do this is to have an abstract trade route/unit/ship/line that can be built and will go from friendly ports to receiving ports, etc. The route would be allowed to have combat units added to it in order to protect the shipments.
a. A unit traveling with a route would be, in effect, unuseable for any other duty until taken off the route.
b. The unit would automatically defend the merchants from pirates/bandits/enemy units.
c. The unit would fight the same way as any other unit, but would be unfortified.
d. More than one unit could be added to a route.
e. Routes that cross sea lanes would have to have ships built for them and would have to have a capacity limit. Building more 'routes' would increase the capacity. These routes could carry various items, including units, provided that the destination was a friendly spot (i.e. you could not ship units to a neutral port, you could ship them to an allied port).
f. Routes would take a finite amount of turns to reach destination. For example, if Civ A sets up a silk trade with Civ B and B is 20 squares away then it might take two turns for the silks to begin arriving. If Civ C sends privateers to steal the silks, he would have to figure out (without it being obvious) where the route was. Once he starts pillaging the silks, A would know this and could assign a Frigate or 10 to protect the silk route. If Civ C is still pillaging the route, A's Frigate(s) would arrive within 1 to 2 turns (depending on whether or not C is within the first 10 squares or the last 10 squares) and fight it out.
The same would be true with 'modern' transportation. Submarines could attack routes. In their case, they would actually destroy units (not capture the goods). This would mean that the civ supplying the ships would have to create more 'Route' Ships (similar to what the US did in WWII).
When a trade deal is made, the deal would include who is responsible for maintaining the route (i.e. who's ships will carry the goods). If the route is destroyed, then both civs could renegotiate who supplies the ships. The deal is NOT considered busted just because the route was interupted, it is considered to be interupted. The total # of turns would still need to be honored. If neither side is capable of continuing the route, then the deal is busted.
Note that since each 'route' ship carries a fixed amount, there are very good reasons to create lots of these things. Of course, you would have to maintain your merchant fleet, just as you have to maintain your combat fleet. Transports, as a consequence, would usually only be used for hostile action--as was nearly always the case.
g. Routes would be specified by the responsible Civ. Thus a route could be made longer in order to give it more protection and make it more difficult for an enemy to cause problems.
8. The AI must not have knowledge of routes and submarines. This would completely unbalance the game and make this entire system unuseable.