Even with the standard, non-modded banners, you get used to the flags on the map and learn to recognize them after you've been playing a while. That said - Abysia and Marignon look _so_ similar when zoomed out that only a month ago I sent an army strolling into an Abysian province with a fort, thinking it was mine.
Since it was Cohen playing Abysia, I decided I might as well pretend that I meant to do that, and went to war.
What's more of a problem, imo, is the graphs, where I often find it necessary to toggle some of the nations on and off to determine which line was for C'tis vice Man vice someone else, Abysia vice Marignon, Pythium/Ermor, and Ulm/R'lyeh. It's especially bad in the big 15-17 player games.
Ah well - it gives an incentive to quickly eradicate one nation of each color.
And going back to what Norfleet said - if it's purple, and it has a Vampire Queen, it's Ermor. Even if everyone insists that it isn't, it is - it's a conspiracy.