How to respond to AI denunciation?

I disagree...

Look if you set up the "demarcation line" so that it shows up any time you have settler selected and are moving, similiar to the "Place your city here" indicators, then you would know long before you went to settle on the "East" side of the demarcation line that this wasn't a good place. So no turns would be wasted.

Thus it doesn't matter what the formula is, provided there is a mechanic to show you where that line is prior to you moving to the spot and clicking the button.

If the AI is say... Ghandi. It has decided to go for a one or two city peaceful, culture win and is friendly towards me, and he all ready has it's two cities built, he shouldn't really care how close the player gets so long as you don't settle so close his current cities wouldn't have a place to expand to. So his Point would be 4 hexes out plus 3 to account for the players borders. So 7 Hexes.

Whereas Hostile Sulemein will probably be playing a REX Conquest game and won't want you anywhere near his zone of expansion. So if wanted to place cities 4 hexes apart and have three cities, his number would be closer to 16 hexes...

It doesn't make sense that Ghandi would have the same kind of Zone of influence or the same Diplomatic reaction to the players expansion as Sulemein, in this example.

AI Winning Strategy (include War/Nuetral/Peace Inclined), Current Disposition to player and Geography should all be a part of it. That is by definition flavor.
 
When we select aircraft a shaded area displays its range. Something like that for "diplomatic incident zones" would probably be good. However, any such graphical display is outside the scope of our current modding tools.
 
Look if you set up the "demarcation line" so that it shows up any time you have settler selected and are moving
If we could do this, that would be great, but I'm suspicious that this is possible.

and he all ready has it's two cities built, he shouldn't really care how close the player gets so long as you don't settle so close his current cities
You're mixing quite different things here; it is one thing to have a flavor designed to attempt to imitate a personality trait, it is another to have a flavor that attempts to change strategic factors.
From a personality flavor perspective, it is not at all obvious to me why Ghandi should care more or less than Sulemein about how close you settle. I don't think there is any valuable personality flavor; it doesn't make Ghandi feel more human if he doesn't care if I settle close to him.
And I don't think we should be putting game-optimizing factors into diplomacy; I think it is weird to think of Sulemein saying "well, I will want more land, so I should make sure that I a have an extra large zone where settling in it will make me angry".
So I really don't see any value here in making the area in which settling would count as a breach to be something that varies across different AI leaders. The AIs and the human should all be the same here; if I ask them not to settle near me, that creates a no-go zone, and if they ask me not to settle near them, it creates a no-go-zone of the same size.

When we select aircraft a shaded area displays its range.
Speaking of which; the range is a bit hard to see; would it be possible to make the indicator a thicker line or brighter color, or or to have some kind of cross-hatching on the tiles we can move to?
 
Apparently there's a bug where aircraft range cross-hatching shows up in strategic view, but not normal view. I don't remember too clearly because it's been a while since I've used aircraft. Most things regarding graphics are out of our hands either way.
 
Aircraft strike range appears as a red border. Rebase has been changed (regrettably, IMO) to orange borders of the individual hexes (cities/carriers) the planes can relocate to. I find the orange hexes are less visible closer to the top of the monitor.
 
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