Setting:
A variety of factions. Along with the Swadians (France/England), Sarranids (Arabs), Rhodoks (Italians), Nords, Khergits (Mongols), and Vaegirs (Russians), I'd like to see some factions based on China/Korea, India, Mali, and the Aztecs, altough if we're sticking to Europe; Germany, Turkey, and Scotland would be lovely.
The only problem I can see with these new factions would be their niche. Most of the current factions have a clear use. Nords-Melee, Rhodoks-Pikes+Ranged, Khergits-Light Cavalry. Even in Warband, it's a bit confusing as to where the Swadians, Sarranids, and Vaegirs fit in, with all of them being somewhat focused on Heavy Cavalry. The only one I could really see would be having China/Korea focused on Siege, an Scotland on 2h melee.
A similar setting to the original M&B/Warband, with a small bit of technological advancements. (No muskets, but maybe bombards.) Perhaps as a bit of a "story", the new technology could be use the clear those rockslides blocking the map in Warband, allowing access to the new factions.
Gameplay:
-Naval battles
-The ability to embed your pike in the ground to stop a charge
-Better sieges. Drop flaming oil from the castle, fire bombards to break open the walls, etc
-Tons of micromanagement for your empire
-Ragdolling. When I stab my spear into the horse charging at me, I want the rider to go flying forward
-Gore/Dismemberment, or at the very least, dynamic wounding effects. When I shoot my arrow into a Swadian's hip, I want him to start limping
-War dogs. I want to sick chainmail-covered mastiffs on my enemies.
-Expanded diplomacy. There's a reason why diplomatic mods are huge.
Graphics:
-Better optimisation. Warband runs poorly on some computers because it's terribly optimised.
-Texture detail. With Warband, even on max settings the textures still look horribly.
-An option to reduce the lighting effects. The sun's glare get really annoying.
-Belly Slider