Lots of wonderful suggestions. All in all, I think a solid foundation for this game would be more detail aiming at more of a simulator style game experience.
Some ideas:
-Waves would push the ships around slightly (esp the smaller ones) making the need to have to counter-steer in stormy conditions during battles.
-More variance in sea conditions (wind driven changes in wave height, more variance in visibility etc-should group flags be visible through limited visibility??)