You cannot stay neutral, because people will attack you to take your resources.
When you're attacked, your enemy feels pride in their gains.
If you repel attacks, then you are a challenge, and your enemy tries to get supporters to help break your defenses.
When you turn it around, your enemy feels victimized.
Even if you only go so far as to take back what was stolen from you, your enemy will always remember that you fought back and will be resentful, waiting to build up enough support to come back at you again.
Your only options are to:
A) have nothing of value, and remain hidden, or
B) beat your enemy down to to the point that they cannot ever attack again, or
C) Apologize, pay retribution, and join forces equally.
Choosing option A means you cannot play the game. That's just not fun.
Choosing option B means you have fewer people playing with you, and it's generally considered "not nice", though it's safer if you have the resources.
Choosing option C means your new ally's enemies are likely to decide you are an enemy now too, even you you try to remain neutral. This is outright frustrating.
Why isn't there neutrality? I guess we are at the technology point where our beastly nature is at odds with our technological advancement.
I see nothing wrong with option B. Be a neutral juggernaut. Anyone who attacks gets their entitlement to a polite response rendered null & void. And I wouldn't mind having someone/an entity like that on my side!
War
Ultimately I became two-faced. I split my resources between two countries. Each one was allied with one of the two warring factions. My two countries would help eachother out secretly depending on what was required for the other to remain "a good neighbor".
As each side was attacked by the opposite warring faction, I ultimately destroyed both of the warring factions.
It's funny how, both of them ganged up on the other, and both of them cried foul when it happened to their own country.
war
As for how to retaliate when there are civilians...
It takes me back to what some of the guys said at work right after 9-11... "We should turn the whole region into a big, glass parking-lot."
At the time, I thought it was a bigoted, harsh statement to make.
But there's something to be said in having it over and done. Ghengis Khan would kill the women and children, so there wouldn't be suffering left in the wake of his army's razings. Partially merciful, but also, if there's no one alive who suffered, then there's less retaliation.
That's an awefully brutal standpoint, but potentially effective.
Re: war
Yah, it's a lot easier when it's one person, one place, one group. This whole distributed aspect changes the playing field.