hmmm... similar problem, when starting a "deity-game", so it's not (only) difficulty:Then they probably don't have enough workers. low difficulty level....
Just wanted to look, how AI develops and "waited" 100 turns. Then I opened the WB, to have a closer look.
Summary:
- Two AI spice-firms were founded. One of them in turn 88. (so i suppose, the other players haven't harvested yet)
- The two "founders" were on the last two ranks (excluding my "humble" faction)... they simply had not enough space to expand, what means enough "other tiles" to develop first.
- Everyone had the necessary techs to harvest (they were quite advanced at all: Lansraad was founded in 13191AD)
- Alia, who was spied during the game by my scouts developed nearly all other tiles (built several cottages, mines and stuff), just ignoring the spice lying in front of her "house". That means, she developed also "non-ressource-tiles" before going for spice!
- in turn 100 there were overall five(!) tiles harvested on the whole map. All by the Harkonnen (the only guy with only four cities). He also has developed every other tile in his borders... making a sum of 21 developed tiles for a population of 6

Don't know if it makes a difference, when starting a game on "monarch", but I won't give it a try until the next patch... sorry

I don't think it will be a „game-breaker“. Strategic ressource doesn't mean, that you loose the game, when not having it. Other ressources give health or happiness bonuses, too. Have you ever lost a vanilla game, because you had no gold and no rice?! I don't think so.That would break the game I think, making all other resources unimportant. And why should spice be giving happiness or health??!? Ordinary citizen/workers can't afford to buy significant quantities of spice. Only the incredibly wealthy can become addicted. Most of the population never gets more than trace amounts, they aren't longer living or easier to keep in line because of it. The spice all gets exported, not used for local consumption.
Maybe we understand fusetechs suggestion in different ways and that's the problem. IMO it should be read: As soon as you have one spice, all cities gain +1health +1 happy (just like gold AND rice in vanilla). More spice doesn't expand that bonus, so you do NOT get +2,+2 having 2 spice and so on... in that case, it would defenitly be much too strong and a „game-breaker“!
Strategic ressource also doesn't mean to me, that it is needed to construct units (although I think, that's the regular term). I think, you can also declare ressources as „strategic“ without creating units, that require it. If not, it would be possible to add a non-essential bonus unit (such as war elephants via ebony in vanilla... maybe with even more prerequisites, such as religion: Jihad+spice=Fanatics or something).
The only reason for declaring it as „strategic“ should be imo, that the AI develops it earlier and maybe settles more „coastal“ (hopefully...).
...and story-relation:
do you remember the Fremen-spice-orgies?! I don't think, that inhabitants ON Dune had no access to spice. Remember Paul saying "It's in everything here"?! (don't know the exact words, as I saw the film in German) ...and even the inhabitants of a Harkonnen city might be "happy", that they won't be slapped to death, when bringing their spice.
All-in-all, spice is still too useless to AI-players IMO... somehow it must be "upgraded" maybe by giving it even more commerce-output when being worked by citizens, but giving "only" +2 for the spice-firm. I can even think of upgrading the c-output without cutting the spice-firm... or by increasing the hammer output. Most other ressources (esp. the non-water-ress) give also a bonus of 6 or 7, when upgraded, but they also provide you happieness or health. Yes, I know, +3c of the firm, but for other ressources there is no "danger" of disappearance.
How do other players think about that?
So far... hope you don't feel bothered... this mod is way tooo good, that it cannot founder on stupid AI-behavior... that's just my opinion.

Greetz, Hived!