aiResearch, interesting (and fun!) research topic. I probably haven't thought of this much yet, but here's a few basic points you should consider (here, by "the AI", I mean the Civ3 AI):
1. The AI doesn't do any sort of learning. This cuts off of a big chunk of the AI field (if you don't like learning, you picked a good research topic!).
2. The AI lets the Governors make all the build decisions. In other words, it doesn't explicity determine "what's should I build next?", but relies on a fixed algorithm (the Governor preferences). This is why it will continue building Swordsmen when fighting Tanks; it just told its Governor that there is a state of war, so building the best military unit is probably a good idea. This point demonstrates that the AI is highly component-based.
3. The AI is probably divided into a number of agents, each responsible for a different aspect of a successful game. So, there is probably a "expand" (found cities) agent, a "research" a agent, and so forth. Which agent gets prority at various stages of the game is certainly an interesting algorithm. The AI is definitely not programmed to specialize.
4. Within each agent lies a large set of condition-action rules. This is especially obvious in combat, where you can guess where the AIs units will go (usually chase a random Worker or Scout). These rules (the heart of the entire AI engine) were hardcoded by people who know how to play the game, and play it well. All the nifty little strategies that the AI employs are represented by these rules.
5. As for unit movement, this a straightforward search problem. Based on what the unit is meant to do that turn (explore, attack, defend, settle, improve, etc.), a different value function is assigned to each square. In combat, for example, a high score is given to a severely injured unit with a low defense rating that is reachable this turn.
6. Planning. I'm not sure the AI does any planning. It certainly does no high-level planning ("I'm going to kill the English which will give me a precious source of Gunpowder allowing me to advance on the Persians, etc. etc.). Such plans are the very reason why us humans can "outsmart" the AI.
These are just some things to get you going, in case you're just starting your research. I'm making no guarantees that these points are accurate (partly because I haven't thought about it enough, partly because my opinions are solely based on observations of the AI's behaviour)!
Good luck!
Dominae
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