There are no rules in a nations game, the outcome of all actions are determined by the players as they see fit to their game. Games are run for as long as there is interest and then can be phased out of existence.
Nation's will allow players to define maps and move their units around them. Maps can be of anything, from a city to entire galaxies, and players can build pieces and upload them to the map to play with.
While the main goal of a nations game is to support how a state, or territory performed, the flexible nature of the Nations engine will allow you to keep track of things such as military units, kings, princes, and entire solar systems.