I would like to share my views on what i think about this issue and i would also like to know if anyone of you have ever had a succesful campaign playing as the WRE.
Here is what i believe must be done.
1. Abandon regions without strategic importance such as Britain and Spain, they are of no use to you from the beginning and only spreads out your forces on an even larger area.
2. Concentrate your heaviest troops around important cities such as Rome, this way you can defend these cities while you leave your frontier cities in the hands of cheap units such as peasants and the like.
3. Organize an army that can counter attack, when given the opportunity. This army can consist of any infantry type really, with cavalry as support troops.
These are the three steps which i suggest, but there are others which might work even better. So those of you who have better suggestions feel free to share them, any ideas are welcome