The history of Strategus is a bit different than any of you are suggesting
Also, limited alliances won't work. There shouldn't be restrictions on player's or factions ability to interact and do diplomacy.
Its inevitable that people will try to form alliances and groups. Since you can't change that aspect, and if you tried to it'd make the game boring, you have to change other things.
Strategy/war games are always better when they try to fully account for the factors involved in warfare. Its impossible to do it fully, but the more you try, the better the game is. That's why it needs economic and logistical elements - war is, and should be, very difficult. It'd also be nice to have the social elements taken away from players too, though I think that'd be quite hard to do. Ideally the aspect that the players should have full control over is the leadership and the actual fighting - they play the part of the government and the military of their faction. The rest is down to game mechanics and they have to manage it properly.
Make economic, logistical, social (possibly) factors more complex and challenging - the diplomatic stuff should be handled by the players. With more complex and challenging mechanics of warfare, it won't be so simple and easy (and obviously beneficial) to just form a huge alliances block and wipe everyone.
For example, previously strategus was a bit like Risk - take territories to make more soldiers to take more territories. However, it was like Risk with alliances allowed, which is silly. Risk can't be played with alliances and diplomacy between players, because the game isn't complex enough to allow it. Strategus has diplomacy, and the game has to be complex enough to allow for it.