Bribe her.
Give some presents to get higher reputation. It unlocks empress events. During the events you can make choices leading to better reputation.

Oh, so she's just bullshitting about the town not going well, and it's just a matter of whether I've buttered her up personally enough. I was suspecting this after a while, good to confirm that's the sort of person she is. Luckily, I'm apparently such a great ruler that a pegasus literally descended from the heavens to give me a gift, so I should have plenty of bribe money for the rest of the game.

That sounds like a bug or you're not sharing some details of some of your choices. I've had her happy with me on even voidist runs with a black market, which gives a lot of rep hits if done without thought. This is without high rep from her, to be specific as well, but at least in the positives. Have you gotten rep hits with her during events? The best ways of dealing with her I've found are not making more work for her, which seems to be the one thing that is guaranteed to get rep hits. She might give rewards or you get rep with her for solving problems efficiently without bugging her, I find.

No, it's not a bug, my complaint was that she pretended that she was unsatisfied with the progress of my town when the actual problem was that she just had a negative reputation with me (largely a result of me doing everything possible to rightly antagonize the vile Avallerians). (EDIT - to be clear, it's not a problem now that I know that's just the kind of person she is, it just didn't occur to me until the reputation was pointed out that this was the case, since the text only mentioned things like town expansion and townspeople's happiness and I was first looking there for what could possibly be wrong.)

Anyways, I had the nice people in Meblia help me obtain independence and (with my other allies) slaughter a bunch of her minions, so she's not a problem anymore. Also got to start a riot in which 7000 people stormed her castle and executed a bunch of corrupt officials she liked. I'm not quite done with the game yet - I'm really hoping I get the opportunity to have her (as well as Llemyon, tyrant of the notorious Fleidalans) personally assassinated and/or her regime overthrown entirely, but it doesn't look like that's going to happen. :(

Originally posted by Typical_Name:

Oh, so she's just bullshitting about the town not going well, and it's just a matter of whether I've buttered her up personally enough. I was suspecting this after a while, good to confirm that's the sort of person she is

Originally posted by Typical_Name:

Oh, so she's just bullshitting about the town not going well, and it's just a matter of whether I've buttered her up personally enough. I was suspecting this after a while, good to confirm that's the sort of person she is. Luckily, I'm apparently such a great ruler that a pegasus literally descended from the heavens to give me a gift, so I should have plenty of bribe money for the rest of the game.

One of the best parts of the game is that almost everyone has their good and bad sides.
Eg Gaird is such an аss when you go all ethalian alliance. But his personal quest is glorious, literally the best guy in game

So my girl Ophelia isn't that bad at all. Just a bit confused with her own personal problems.

Some people are just bad and evil tho. I can't and don't want to understand innkeeper and black market dude
Even Kieran isn't THAT shady.

It is possible to redeem the black market owner. I even like the unique good ending she gets where she basically sets up a Like A Dragon gray zone situation and the town actually becomes safer as the criminals traveling in understand her rules of not interfering with the town.

Now Ulvar is just a monster, and I like that little trap the game plays by making you think the market place is the best option when that gets you the biggest jerk of all of them.