There has never been a diplomatic option to end vassalage I think. You have to declare war, which Sweden should be able to do since she starts with stability -2.
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Sweden only has slighly lower building costs than Denmark, whereas Russia pays virtually nothing for her infantry (and her cavarly is cheap too). The number of provinces is pretty accurate and Sweden's location is actually a strategic nightmare, sandwiched as she is between Russia and Denmark. Considering her low population and large territory, superior leadership is all she has to ensure a historical progress.
Remember that the difficulty a human has playing a country is irrelevant: what matters is that the AI performs historically in the average game. Indeed, developing the IGC we are constantly running "hands-off" games to determine game balance, and Sweden actually performs worse than she should is most games. To an even greater degree this is also true of Denmark, which provides us with an interesting array of choices: Strengthen both Sweden and Denmark, Weaken Russia and Sweden or Strengthen Denmark and weaken Russia.
Well, it is a tricky matter, and as seen from the response we have already garnered for IGC 2.0k it is also a very sensitive one...
IGC 2.0k essentially weakens Russia in relation to Sweden (even if Karelia is now Russian). There are now level 3 fortresses in Savolaks and Nyland, representing the pretty powerful historical castles at Viborg and Olofsborg. This, coupled with some leader adjustments seems to take care of the Russo-Swedish part of the problem. Unfortunately, the introduction of some new Swedish leaders could make matters worse for Denmark.
The Danish issues remain to solve. These are the main problems as I see them:
* Norway should be much harder to invade.
* Skåne should remain Danish for a century longer than is usually the case in the game.
* The Danish AI should be much less likely to offer Jylland in return for peace.
* The Danish AI should stop trying to garrison Gotland with 60k troops.
We actually tried adding level 3 fortresses to Östlandet and Trondheim to represent the difficulty of invasion, but this seemed to lead to a severe bleed of Swedish troops, making Russia even more likely to chop off eastern Sweden. The same was true for Skåne.
Since we can't really do anything about the AI, I can only think of the following solutions (which we will try out for IGC 2.1):
* More Danish generals for the first half of the game, especially 1492-1570.
* Improved Danish monarchs.
* Lowered Danish build costs.