Is diplomacy necessary?

Really? My apologies, I didn't understand. Well, this really won't help much and will only lead to the computer simply lowering its morale (most likely). Giving the computer a better army is indeed a better option.

The computer doesn't use such a secondary skill as diplomacy rationally, and as such, it generally doesn't pose much of a threat...

And to make things more challenging, there are many possibilities: building structures in the castle, the number of starting heroes and the starting army, and alliances between computers – these are all good things. :)