It costs points, but it's worth it. Looting those advanced Indians will get you about 100000 gold very early on in the game, which I found vital for getting started. It allowed for an earlier completion of the game, and saved you a lot of tedious fur-trading-struggle!
This was my formula for winning the game:
1. Get some fur, sell it
2. Buy artillery, go killing Aztecs or Incas
3. Use loot to buy more artillery and a Galleon ASAP
4. With your by-now formidable army, kill of all the other Europeans
5. Mine all the silver you can find
6. With your huge treasury, buy whatever specialists you need
7. Build up your colonies, aiming specifically for the following:
a) Ore-, tools-, and muskets-production centers
b) Liberty-bells center with three Elder Statesmen
and Newspaper
c) getting new Colonists, either through farming or preaching
(whichever way, just make sure you specialize)
d) make sure every colony is breeding horses
e) effective education system, keep those specialists coming
- especially Veteran Soldiers later on
8. Systematically build up independence sentiment in your colonies
9. Get all the founding fathers, build up a horde of Veteran Dragoons, and a road system between all your colonies, stockpile guns and horses.
10. Declare independence. During the war, never let the Tories make attacks - attack their beachheads with all your cavalry. This gets you the attack bonus and, very important, the terrain bonus as well. This simple strategy lets you win the war against incredible odds.
Last time I played Colonization, I built up a large and prosperous "civ" stretching all the way from real-world New England south to Argentina, all connected in one road system, with large prosperous colonies all the way through. It was on Viceroy, but I can't remember my score... except it was definitely more than 150%. How much are people scoring (or have scored) on this forum? That game was the "Game to End All Games", haven't played Col since.