The AI does indeed cheat even at the lower difficulties, as it was proven by some players and acknowledged by the developers themselves. Production rush without spending money, ability to build cities in unfertile land, tile output magically increased for the AI and so on. Some of these issues are bugs, some seem to just be unfinished features, but overall it's nothing terrible. Yeah, this AI isn't of the smartest kind maybe, so it has to cut corners here and there, but honestly, there has never ever been a single 4x game of this scope where the AI REALLY played under the same rules as the human. Some publishers boast more than others about their AI smartness, which can lead to misunderstandings, but the whole point usually is that you HAVE to streamline and simplify what the AI does in the background, as you have to save resources and there's no point anyway to write incredibly complex routines for something you never see happening anyway. Just think of water travel: there never was anyone who managed to make an AI use water travel and trans-continental warfare in a decent way. The best thing we ever had was the auto embark in CiV, which substantially was no "real" water travel at all, just "waterwalking". If something like making an AI able to load units into a transport and ship them coherently is already too hard to code, how can you expect miracles when it comes to everything else? The game is indeed a bit buggy here and there, which isn't really satisfying after such a long public beta, but it's in no way "broken".
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