Thanks all who answered, exploring those options does help a bit. I've been playing around with those settings, but haven't found a setup I am completely happy with. The issue seems to be that all starting locations are based upon distance from the player and don't take into account proximity to other NPEs (non-player empires). This creates problematic starts for many of the races as a number can get clustered together while a few have wide open ares to explore and colonize. This is particularly an issue on clustered galaxies as this usually means one or more empires start in the middle of nowhere with few stars around them. So far, assuming an irregular galaxy with 700 stars and eleven other empires, the best distribution I have found is to make one empire set to near, two to average, and the rest to distant. This still tends to end up with a couple other empires being close neighbors, but is better than the default of all being random from me.
If it is possible, I think a way to even the start out a bit better (assuming this is desirable for anyone besides me) would be to have an option to have all empires start at no less than average distance from any other empire, including the player. Even better, if this algorithm could try and avoid starting any empire in a sector with less than 5-6 stars that would be ideal. Anyway, this is a minor suggestion for an already very fun game.
P.S. If Erik is reading this I think I found a very minor bug. Normally when you start a custom game your previous settings will be auto-populated. When setting up the distance of the empires, the first empire always returns to "Distant" upon the next custom start - the others all seem to retain whatever you specified the previous time.
< Message edited by r9hearts -- 5/25/2014 5:07:20 AM >