About the Japanese gears on the screenshot, it is actually a citation given to Oda Nobunaga, a moment before he was murd... err, suicided
It roughly means "life sucks" (or "monde de merde", as George Abitbol once cleverly stated it).
Such citations are quite common in Koei games title screens.
About the cheating AI, there is a couple of factors : the game has got quite a trouble with factions status and tend to put them always back to the same default settings (a bug wide-spread accross almost all versions of the first game it seems). I admit the reinforcement thing is quite infuriating too
Also, the leaders play a _huge_ factor in a lot of the RotK games. For instance, even given only 1000 soldiers, Lu Bu is near undefeatable in most instances.
This first game is charming, but it has sadly got quite a bit of bugs and troubles. A Windows remake was released around 2000 as a budget title, but I can only hope it would fix some of those issues, although hardcore fans prolly label those as "features"