Hi!
Well, I can't comment on sieges in fortress mode, but if you don't need currently alive megabeasts, I strongly recommend having as many civs as your world size allows.
However, there are a few things that can help keep things interesting:
You need a good number of mountain squares for goblins to survive. Goblins will not settle in anything but dark fortresses, so they need room to expand on their own. Dwarves and humans, however, will settle in conquered dark fortresses, so you can have chain reactions where one fortress after the other is conquered until an entire civ is gone.
If you have real trouble with goblin survival rates, reduce mountain caves - they are also a health risk for goblins, obviously.
In addition, boost evil areas as goblins are the only ones settling in evil mountains.
Dwarves are robust. I regularly see them conquer and inhabit goblin fortresses and I also saw them settling in forest retreats (actually, I saw a world where there were dwarven forest retreats far away from any mountains because they kept pushing forward).
Elves are extremely weak. If they settle near a cave, most of the time, the elves tend to get destroyed before the year 40. So, the number of non-mountain caves is something very difficult when dealing with elves.
To further elves, increase the minimum for forests, drastically.
Also add a bit of good for those good forests they like.
Humans are a pest that will spread quite easily. Reducing the minimum of hills and grassland squares is something you can and should do, although if they are completely nil, humans may actually get whiped out.
As for world gen conflicts, the most fruitful ones are definitely humans vs. elves. If you are able to get a large forest next to a medium-sized hill/grassland mix, you might see centuries of settlements destroyed, rebuilt, conquered, reconquered. It is really great.
However, that situation can always flip over with one side annihilating the other.
Goblins usually cause smaller skirmishes and not that many destroyed settlements, so they are not that exciting.
Deathworks
EDIT: I better get offline now so that I can continue playing that fortress I mentioned. I really hope to get something ready for your dungeon challenge (it's a pity there has been so little resonance thus far).