2: Does it often work to have NPC nations that existed before the player factions? Again, this world has a lot of history, so this idea has feet, if it wouldn't take away from the experience. Primarily I thought to do this to lend credibility to the world, because prior to the roleplay their are lots of countries and I have yet to decide how many can stay. This will also need to be a factor for deciding scope.
I'm glad you brought this up, because NPCs outshining the PCs is a real problem in many genres. NPCs have the advantage of being developed as part of the backstory, while the player characters are developed by mere players, who can neither edit the backstory the way the GM can, nor read the GM's mind; therefore, the NPCs can be "baked" into the setting in a way that PCs can't. (There's also the issue of GM favoritism, which I'll get to later.) There are a few tricks I've developed for mitigating this, and while I developed them in the context of tabletop RPGs, they should generalize.
1)
Are the PCs and NPCs active on the same scale? If the NPCs have some grand plot over the span of aeons, which the PCs simply aren't important enough to affect (yet?), then the NPCs are forced to take a background role. It might seem counter-intuitive, making the NPCs
more awesome to keep them from outshining the PCs, but it is effective in moving them "out of context" with regards to what the PCs care about.
Think about it this way - if you're writing a sitcom about office politics, you'll want to have
some idea what's going on with the larger company, but the specifics don't really matter. The CEO of our hypothetical corporation acts on a larger scope from the main cast, and so they become a background feature. In fact, we can see this happen in real-world TV shows such as, well,
The Office. In the same vein,
Firefly's Alliance is the real power of the 'verse, but Alliance politics come up exactly
never except as backdrop to a heist.
2) Keep the NPCs reactive. This is something of a generalization of the above. If the NPCs don't mess with the players until the players mess with them first, that's also effective at pushing them into the background. As a corollary, when the NPCs
do start taking notice of the PCs, it makes the players feel
awesome. (This point was really driven home by a quote from one of my
Fate players, upon realizing a blockade was set
specifically to catch the party: "I guess we're a big deal now." He was
grinning.)
3) Let the PCs have relations with the NPCs. (No, not
that kind of relation. Get your head out of the gutter.) In the
13th Age system,
every player character has some sort of relationship with three "iconic" NPCs.
Fate actively encourages players to help the GM define NPCs by referencing them in the PC's aspect list. If the PCs and NPCs are supposed to be on a more even footing than the above would imply, setting up the character sheet so the two can care about each other is a really good idea. As a nice bonus, you can use the same system to encourage players to set up relationships between PCs, if you're so inclined.
That said, I would recommend keeping the number of significant NPCs small. Even if they're just reactive per suggestion 2, having too much information to keep track of can overwhelm the players and even the GM. Minor NPCs are actually worse in some ways, because the players feel like they have to keep track of them even if they're ultimately just there to provide texture; making it clear who is and who isn't important can help, of course. This also gets back to your first question about the size of the space (though, as I've never attempted to run a civilization-building game, I can't offer too much concrete advice there). Once you figure out a list of NPCs that the players can reasonably track, mapping out their territory and leaving room for the PC factions should give you a good size. Generally speaking, I'd imagine that the map should be smaller the more micromanagement is needed, and vice verse. If people are worried about individual cities, there should only be a few of those. If the game is more concerned with broad geographical areas, you can go larger. Going back to my tabletop days again, though, creating distant NPC civilizations can be a great way to make the map
feel bigger without actually adding much complexity.
I hope that helps! And please feel free to send any follow-up questions my way.
