This is what I have found to work very well. I use a large galaxy, 250+ stars with 20 empires..no neutrals. I have modded the set up so that all planets are huge with each system having 2-3 rock oxygen and each planet with a minimum of 100 resource types each. I reduced the probability of black holes to 1% and create AI races with 5000 points, including plus ups in maintenance, research, mineral production, and usually advanced storage techniques. I have also increased the use of organics and radioactives in producing ships and facilities. This forces me to balance out production of the 3 resources and not just concentrate on minerals. As for the game I use hi bonus and hi diff settings. I also use Mephisto's modpack..I really enjoy those Darloks. With this type of setup, the AI has no problem with a lack of resources or room for expansion. Usually by turn 50, I have seen empires with nearly 100 colonies and over 1000 ships..some even had nearly 4000...ugh. Plus with the latest AI upgrade, I actually see the different races beat up each other pretty hard, even eliminatng a few. I have never been able to achieve better than 5th place and am usually around 10th. I also dont do any cheap shots early in the game like placing mines or satelites on enemy homeworlds.
Hope this gives you some ideas
Sabre21