Like in Cybernations Standard, I believe that there should be a +250/-250 nation range on top of the 200%/50% range setup we currently have. The reasoning for this is because in the later parts of the game, the top nation's strength is usually inflated to a point where few, if none, can declare war on them. This practically solidifies their places on top, taking out any potential of knocking them off their throne.

With the +250/-250 system added in, those on top will have to fight to keep their place, as well as making sure no matter what strength you are at, you will have competition and targets.

So what if the leader has 9500 NS (as an example) and the second person has 9200 NS and the 3rd one has 8800 NS then what happens?

The +250/-250 is referring to nation rank, meaning that anyone within 250 ranks in either direction can declare on you, regardless of NS.