No XP or GOLD = People don't care.
Sure it is still loads of fun (if its an equal battle = skills decide, not gear/troops) but everything else comes first then, especially if you're a newcomer or relatively casual to the game, why spend an hour on a Strat match for nothing (except making "enemies" of those you sign against for no actual good reason) - I'd much rather be spending time making gold, grinding heirlooms or playing with a buddy.
Fix the XP + GOLD (any sort of neutral fief payment) and things will return to normal. However a lot of the map has already been taken - almost free - by half the factions on the map, so the damage is already done in this area, however as long as it could be fixed prior to people taking Castles/towns then it might rectify the damages in the long run.
Everyone should have to fight a full village of people.
If XP/Gold wouldn't be enough to get people back into the neutral fief defenses then perhaps neutral fief defenders should be listed anonymously, both in-game and on the web site, you'd only be able to see if you're accepted or not. I'm sure some people can spot play-styles, faces, and what not, but it should still 100% ensure that all fiefs are well defended. Perhaps allow players to 'tag' whether they want to be listed anonymously or not, thus allowing factions to still call for organized defenses.
Some more visibility in terms of 'Strat battles' would be good too.