I think I saw vassalization as one of the unlocked abilities under feudalism in the tech tree seen in the DevDiary video, although it was too blurry to be sure. But if there are vassals, then I think other forms of advanced diplomatic relations would also be fitting. If you conquer someone but don't want to deal with instability, you can vassalize them. If you have had an alliance for a long time and maybe you are both behind on fame compared to other factions, you could have dualism like you suggest so you both share the fame that you earn while forming a single faction that is stronger united. If you have a lot of trade routes and are allies, you could form a trade union, where you share each others trading posts to extend trade route range and have money bonuses from trade with each other. If you are allies and have similar politics and government types, you could form a treaty organization which makes it easier to coordinate troops and espionage against enemies but bans war and espionage against each other. These alliances could also set up world war type of conflicts.

I agree with you.