I've always tended towards the last approach, so there are plenty of level 1 kings running around in my game world. But this quote from Crescent Throne got me thinking:
"But why?" Zamia asked. "Why would any man—even a cruel man—do these things? What could he possibly gain?" "Power," the Doctor answered without hesitation. "The same thing that a man gains when he murders one of his fellow men. The same thing that a ruler gains when he sends his armies to kill and die. Power and the promise of a name that will live forever."
Reading it, I thought, "It would be cool if there were some game representation of this 'Powwah!' that evil guys are always yammering on about. Like, by performing dark rituals, or merely by exercising political clout, you got some game benefit that made you more dangerous."
As I thought about how to represent "power", I discovered, as often happens when I re-examine a potential house rule, that the concept is already built into D&D. Levels.
What if the mere act of channeling power gave you a level minimum? Whatever his personal XP total, for instance, a king always has the HP, class features, etc. of at least a level 10 character. Channeling the eldritch might of some evil dimensional vortex gives you the abilities of a level 20 character - as long as you keep the vortex open.
Whoever holds the real power gets this benefit, of course. There are no level 10 babies. The regent is level 10 until the king is old enough to take the reins of power. This translates political struggle into D&D's vernacular. Cersei and Joffrey are squabbling over who gets to act like they're level 10.