heinous_hat
Prince
This, however, requires a Supply Line Mechanic which Gedemon is working on, but so far as I now has never been mentioned by anybody at Firaxis.
That'll mess up the AI even more
It doesn't though, because it works passively... the AI naively builds infrastructure that helps sustain nearby units. Supply lines extend automatically within a finite radius, and lose efficiency with distance. But with the present (smallish) map scales, that's rarely a problem. If anything, it actually helps AI players by softening the effect of critically bad decisions (since units "heal" continuously). The biggest problem presently is a common vanilla flaw... AI will lose focus on unit production during war, and not commit to it in the right area. The mod mitigates that somewhat by extending unit lifetime, but it's still a factor. Overall, it's a really thoughtful design that takes the game's tactical and strategic shortcomings into account, while adding a lot of detail.
On canals... I think that would be difficult to work into a supply system that deliberately avoids the AI's inability to put things in specific places. Canals would likely be more practical as a generic city construction, rather than a tile improvement (or district) that requires judicious placement.