Well let me begin by saying i cant stand steam. I dl'd half-life 2 over it and its one of the buggiest games ive ever played.
So i suggest you never buy a steam game again.
Well let me get to the point, you cant install mods on medieval 2 through steam. For some reason all steam games are in a crazy large GCF file (whatever that is). Half-Life 2 is a 800mb GCF file for example. There are no folders in which your game files are found therefore, there is just one massive unreadable computer code file that runs the game.
I suggest you go out and buy a normal copy of Medieval if you have the money, otherwise your out of luck.