Yes, there has to be peace on the enitre world. In my game the only people in the world are me and the pet AI city. So there is no combat on the world at all. I already know that Barbs don't count as the required global cease fire, so they aren't an issue.
I also wondered about the act of sbotaging their unit, but I only do it every 20 turns or so. So, I should get the peace bonus during the gap where I just let them sit there merely adding one shield to their production. I get no peace bonus at all. None. If I did get the bonus (that should start after I haven't touched them for a couple of turns) I would allow them to build their unit and get the extra points, but I am trying to test it out during the GOTM without breaking the rules of reloads or cheat mode. So I am not losing my peace bonus, it is simply not there.
Once GOTM9 is over I will test it out more thourghly.