Course the "reality" is that 1-3rd rates were like unicorns in the Caribbean.
If they want reality we would all be in sloops, brigs and the occasional frigate anyway. But that isn't the reality they want...
I personal think pirates should be something you earn, not something you click. Join a nation, murder 12 friendly's and you get to be a pirate.
Pirates can false flag and dock and sell anywhere at a loss (they are fencing stolen goods) they should also get some bonus to break down ships (extra crap) to offset the price hit they would take to craft.
You could maybe spend some stupid money and buy your way back into some nations favor, but it would have to be whatever the under pop (and thus desperate) nation was.
Pirates can sail whatever they can steal, if they could gather enough shit to build a first rate, with as much as it would cost them in addition, hey whatever.
That said, pirates should raid ports for a cash and commodity payout and not capture or defend shit.
Course I also think they should get rid of the NPC's and make people earn the xp from pvp... So I may be cray cray.
Just my take on it.