OK, so far I haven't yet seen what I feel would be the fairest system of PvP. The "Battle-Isle" scenario.
This is where 2 or more players (or even teams) would be shipped to another island, which contains resources or other goodies that they will combat to gain control of.
This scenario would mean that both sides would agree beforehand to the combat, and nobody would lose anything of their own settlement, just the troops that they committed to the Battle Island.
It could even be extended to a "blank" island, where they could start with a storehouse each, and have to develop and conquer the island that way, much the same as now, except the opponents would be live, not just bandits (although i see no objection to adding bandit camps as well for looting).
The only problem with this idea would be time limits, could such a scenario be paused unless both protagonists were both online? It would be rather awkward for the player who can only play a few hours per day to compete with somebody who can be online 24/7.
Perhaps it could be set up to be playable between certain times of the day by the players, then outside those hours, production would continue, but neither side could then set anything else up until the next 'window' opens?