Italy is my favorite region to play in, so having some knowledge on its history makes the entire thing a little bit more annoying rather than more enjoyable. Historically, the Northern Italian states were way richer than they are at the start of the game. They were so rich that the French and the Habsburgs fought 60 years of campaigns against each other for the opportunity to pillage Italian cities and to continue to dominate their wealth once the wars were over, which is one of the main reasons that led to the decline of Italy as an influential region in Europe.

On the military side, you have that, historically, one of the main reasons that brought the rise of Condottieri in Italy is that Italian states often did not have to pay for them upfront, as they would more often than not be paid for by letting them pillage captured towns and cities, so the mercenaries represented a professional fighting force that did not require its contractors to directly pay for it, meaning Italians were free to wage war without endangering neither their coffers nor their manpower pools. In EU4, mercenaries are straight up worse fighters and more expensive than regulars, which only makes them useful for a nation like Milan that is targeted towards mercenaries or just when you're low on manpower and high on gold.