[AgentZero]

Given that the beta test is already underway, it might be a bit late to implement this suggestion, but here goes anyway:
I'd like to see a 'Points' system set up for diplomacy. This would be completely invisible to the player, but would have huge effects on diplomacy.
There would be two seperate points systems, one when you're at peace with another empire, and one where you're at war.
Each race would have their own individual Point Thresholds.
When you're at peace with another empire, before you have any treaty, you gain points basically just by giving gifts and accepting demands of the other empire, and a small number of points each turn for just staying out of their way. You lose points by making demands, attacking them, hanging around in their space, etc. Once you rack up enough points, the empire will be willing sign a treaty with you. Once you have a treaty, you earn say, two points per turn of the treaty. You can then also get points by being at war with your allies enemies, and lose points by warring with their friends.
As the number of points you have with a given empire goes up, they will sign higher and higher level treaties with you.
This would eliminate a few of the problems from SE4, namely, empires declaring war on you for no reason (if you're staying out of their space, the number of points keeps going up so it's more likely they'll offer a treaty), and also eliminate the practice of AI empires offering the next treaty up every single turn, until you get to Partnership 4 turns after you've met them.
Also, once you have a treaty with an empire, as long as you don't go zooming through their space, or blowing up their allies (or both!), your relations with that empire will keep getting better. Anyone who's played Civ or Alpha Centauri will appreciate this, since it's infuriating in those games that you pretty much have to give presents to your trading partners every single turn to keep them from hating you.

Moving on, once you're at war with an empire, they would have a defined threshold that must be met before they'll agree to peace. You gain points by destroying ships (1pt), capturing planets (10pts), and capturing systems(bonus 20pts). You lose points by letting the enemy destroy your ships, or capture your planets & systems. Once the point threshold has been achieved, the empire will agree to peace with you. Then the system switches over to the Peace Point system, albeit at a fairly low starting point number so it will be a while before your former enemy signs a Trade Agreement with you. A second threshold would be in place if you refuse peace and continue to attack, and once that one is met, the enemy will surrender.

All of these points would be more or less invisible to the player, aside from maybe a little tag under their name that tells you how good your relations are, and maybe a little arrow showing whether they've gotten better or worse since the last turn.

You would have a default starting number of points with every empire, but depending on their set up, they would react differently. ie: Your starting points are 500.
The Praetorians are set up to go as far as a Trade Alliance if points are 500 or greater, so when you meet them and propose a NA treaty, it is accepted.
The Xiati, however are set to declare war if your points with them drop below 600, so upon meeting them, they declare war.
There would be other things that could raise or lower you starting points, such as racial achievements, or research in certain fields. Also, every 10 points you earn with an ally gives you 1 extra starting point when meeting a new empire, since you reputation will procede you, as it were.

Maybe there's another way of doing it, but I think this is the simplest, most easily moddable way of getting decent diplomacy.

Using points, even Trade could be made to make more sense. Eg: 100kT of resources is worth 1 point, a ship is worth 5-50 points depending on size, a planet is worth 500 points, and technologies would be given point values based on their level. ie: level 1 tech is worth 2 points while level 10 tech is worth 20.
Then, when you propose a trade with another empire, it just looks at -We Get: 10000pts -We Give: 10100pts. and then accept, decline or counter offer, based on what sort of Trade Threshold they have. (ie: A race with a trade threshold of 500 would accept this deal, while one with a TT of 50 would not).