The own AI team is stupid, that's true. Though the enemy AI also isn't that clever it seems. If you play Nightmare more often you will see that it is actually easy the beat the enemy although your AI team make serious mistakes.

After I played several tournaments at Nightmare I hardly lost any game (the most difficult mode is obviously when 10 kills end the game). Sometimes I even managed to get all Awards within one game and made more than 1000 points in the Nightmare tournament at a regular base.

So I would also suggest to make the AI better, but in general, not only the the team mates.

Hint: If you want to kill the Nightmare AI then you have to play differnt than with real people. Ignore your team members and try to level fast and very important get as much kills as possible. Even if you die, it is worth if you get a kill. You need as much gold as possible to buy items quickly. Be aware that the enemy AI starts with more gold. When you watch a replay you will see that the enemy AI has a Narmoths Ring right from the beginning of the game. In addtion it will also get more gold and experience. As you team members will die regardless what you do it is not so important not to feed the enemy but to get Gold at all costs. Try to get to Artefacts before the AI gets them. For example a Mage Slayer will help very much. Try to deny the AI the access to the artefact shop if possible. Flag locks are useful for this. If the AI has Artefacts you quickly can get screwed as it will kill your team members and get so much gold that it will soon has enough for the expensive artefacts. If you can get artefacts first you can dominate the AI.