Lurker's comment: I'm quite new to SG, but I've played one set in 'India stomps the World', and I'm following what you are doing, and I see similarities between both games.
I see a tendency to do this:
* settler factory as soon as possible.
* barracks as soon as possible.
And In both games it doesn't work out too well. In both games the settler factory is starting to produce ordinary units instead of settlers. That points to bad planning on both points.
First about the settler factory; I think a settler factory is most useful when you've got lots of terrain to settle. Without a granary you'll get your first towns in a lot quicker. On a really cramped map it can be crucial to get your first settlers to the best locations as soon as possible. What you don't want is the AI claiming the luxes and best river spots while you're building your granary (I'm not saying that this happened in this game).
I'm always playing 80% water maps, and there's never a lot of space there. I've learnt to be quite fanatical about getting my settlers out to the crucial spots as soon as possible. I often postpone the granary until after I've got a core in. And then it's not so much settlers I'm building with those granary towns, but workers. I've got the towns, now I need to improve them.
About the barracks; barracks are good for quality units, but in the early game quantity is more important then quality. Because what do you need units for then?
* exploration
* first line defense + settler escort
* MP
* looking strong in the eyes of the AI
* blocking AI settler pairs
For all these things regular units will do, and the more you've got, the better. It's only when you begin to fight wars that you need vets.
I've got a few pictures below that illustrate how useful ordinary units can be, and how you can even claim land with them.
I'm Korea in the expansion phase. North of me are the Russians, south of me are the Hittites (Yeah, sorry guys, I play with a color mod, I hope it doesn't confuse you). Until now I've put a few towns in south, but just to the northwest there's an unclaimed area that still has a couple of good spots. In the first picture, 1300BC, there's a Russian settler pair already present in the area (you can only see the Warrior). I'm using a curtain of units to prevent them from going to the river, because that's where I want to settle (you can see my settler coming from the east). The Russian settler pair is backtracking because of my units, and in the second picture, 1000BC, you see where I've pushed them to: Orenburg ends up up way northwest.
You can also see a couple of Hittite settler pairs in the second picture. I might have deterred those from going to those river spots as well because of the presence of my units. I now managed to settle the area with Ulsan, Pyongsong and Inch'on. My settlers weren't there earlier than the AI's, but my units were.