*Shrugs* I think a Badlands settlement (and hopefully Expand Forest action there) is a very good step towards acquiring further territory, be it in the Lowlands or elsewhere. There just hasn't been a pressing need to take territory that's not basically up for grabs until recently.
In terms of 'whose face would you like to punch in', I would prefer expanding east to south at first if we have the chance, if only to make trading with the Dead Priests and ETH easier. I mean, obviously let's not ignore the prospect of settling empty seafront property, but let's not head too far south when we don't have a pressing reason to do so.
In terms of long, long, long range military plans- what I'd like to do is seize the land the Spirit Talkers had before and build up north of the Lowlands to the east. Once we have control of the northern stretches of both rivers, we can basically flood south along BOTH rivers while keeping our logistics stupid-easy and just cut the Lowlands into pieces while taking the middle piece so anyone who wants to trade has to through us. Settle the river valley between the two rivers, make peace with anyone on the east or west to give ourselves some breathing room, and snicker up our sleeves.
I'm not in a hurry to do that, though, in part because we obviously have a lot of opportunities to work with already and diplomacy or disaster may give us the chance to just pick up the pieces. We certainly don't want to punch the WTH in the nose right now when they're part of an uber-polity, wait until they fragment and we have a better chance.