From: The Duchy of Cornwall, nr England
A very difficult question to answer, as everyone will have different opinions. The good thing about the AI is that it is fully adjustable, and although it won't fight smarter, it will fight harder(or softer). When I played the campaign as the GE for the first time on Normal, I ended the first year about 10hexes ahead of the historical front line. The next time I played with custom settings giving the AI troops morale and supply bonuses, and got pretty close to historical. When playing as the GE,by the winter of 42/43 you probably need to boost the AI to help it move from defence to attack, but you can change the settings from turn to turn to adjust it to your taste.
The pre-set "challenging" is now what it says on the tin according to most testers, and only Joel and a couple of other testers can survive on "hard".
If you look at some of the AAR's you will see the AI exhibit some amazing responses to threats. It is better defending than attacking as it struggles to replicate the pockets that were created historically.