Yeah you definitely benefit a lot from writing/playing with folks who don't just want to be the strongest on the board.

If I were to GM one again, I haven't GMed a Nation or Faction RP in a long time I would probably include a Strengths and Weaknesses tab in each descriptor 

Like Military/Politics/Economy/Science!

Have folks explain either to the group or at least to the GM what they can see going wrong or what would cripple them, and come to an understanding with them that if they get too powerful issues will start popping up.

Done that a few times.

Political betrayal, appearance of Tunnelers (Fallout series monster), looming threat of a huge GM controlled army that was poking around at one border.

Can be fun to create a bit of a back and forth between the GMs and the players too.  


[hider=Example]
Faction not Nation but...

Sunshine State.  A Fallout RP.
IIRC threats were Original Mean Greedy Fuck Brotherhood of Steel coming from Georgia to claim all tech.  Supermutants in the middle.  Bayou Lizard things in the South.  A farming conglomerate trying to monopolize the market in the middle.

All the groups except the Brotherhood were player controlled, and I used BoS to create a sort of driving threat moving North to South and then occasionally along the coastline.
[/hider]

Just like in Character Based RPs the fun comes from seeing good writers develop their ideas and characters and this develop their writing.  Sometimes Nation RPs last a looooooong ass time too.  There was one here that lasted I want to say a year or two and still gets started over or little sequels every so often.  War, war never changes.