What I'm doing (Game is wraped up, but will take a bit more to get enough stength to take the planet, 20 turns more or so) is that I blitzed every planet by where the Dread Lords were right at the begining. When they came to attack them, Idestroyed the colony (lowering the planet rateing). They then either by pass it (in which case I do it again) or colonize, then I use by forces to take it (mass driving it before I invade). after two or three go rounds teh planets are no uninhabitable. So now the Dread lords have to fly half way accross the screen just to fight (using up precious space for life support), and when they get here, it is by the core worlds so everyone gangs up on them.
Thier ranking is now at the bottem of GNN reports, they've got one planet against most of the galaxy. Since they didn't have time to get any more colonies, we (allied alien forces) had time to boost up our tech, and can now win virtually every offensive ecounter with them. It's now just a matter of getting the fleet together (transports, and constructers to buil a mid way station for range, I've got the battle ships).
basiclly, a scorched earth policy. It worked for Russia!