In your opinion, did they go too far with the patch, completely shutting it down? Do you think there could've been some more room for reasonable negotiations?
No, because I don't think that buying/selling (or gifting) cities makes a lot of sense, from a gameplay or historical perspective.
Most civilizational expansion in human history has been via invasion/warfare, with (additional) territorial gains sealed by peace treaties -- and arguably, the only other way that territory has historically moved from one nation's control to another's is via revolutions/ civil wars, i.e. 'culture flips'. Also, the idea that a Civ could accept a town on the other side of the planet without having overwhelming military forces and/or control of the sea lanes (in order to supply that town and keep it from flipping) also makes little sense (to me). So if anything, I'd suggest that they didn't go far enough with the patch: had it been up to me, not only would city trading/ gifting be disallowed during peacetime, but the only towns which would be eligible for transfer during peace negotiations, would be those adjacent to (the victor's) current borders -- who gets to dictate terms is after all a good measure of who 'won' a war.
On a vaguely related note, I also think it's a little silly that all citizens living in gifted/ conceded towns
instantly acquire the nationality of their new owner, whereas in towns which change hands via culture-flips (i.e. where the citizens really '
want' to be part of a different civ), citizens retain their original nationality until assimilated. Seems like that should have been programmed the other way round (and don't get me started on the AI's freebie-units in a flipped/gifted town, that the player doesn't get)...
Don't get me wrong, I really enjoy playing Civ3, but for a game that purports to model human history, the above are just a couple of examples of things that I find 'unrealistic' (for want of a better word).