In my current game, I got a sovereign to surrender. when I looked at his equipment list, I saw that he had purchased 6 horses and 6 wargs. That seems a bit much. don't think he had twelve heros to trade them to.
2. When I captured a city with an AI hero, the hero stayed in the city recovering for 5 turns, and then became part of my faction (It wasn't until many turns later that his sovereign surrendered)