Whoa. That looks... Complex.
Back on topic...
I see what you mean about the N-1. I like your thoughts about them being ceremonial, and small. But I still think that they could have a fleet of Z-95, or something else, to use in engagements, perhaps with pilots in N-1 leading the squadrons.
Also, I feel the ground battle needs a lot of work. Jar Jar needs to be cut down to a soldier, who seriously understands what he's fighting for, and what he is facing. I also feel that throughout, the battle droids need to have their dialogue redubbed, except when talking to non-droids, and their role changed slightly.