Yeah, it's crazy. You should be able to load recorded games, which is a setting which you can toggle at before the game and you can load up the game from your saved games folder and watch from the AI's perspective. You can see exactly what they're doing throughout the game.
Welcome to the awesome world of AoE II. To beat hard ai you need early aggression and keep up the pressure from there. If you let it be it will mass ungodly amount of military backed by mighty economy and steamroll you. Also build farms around towncenters, not mill. Villagers are safer there as they can hop in to safety from potential raids.
