The main problem with this is that Max has just destroyed his chance of reconciling with the Hungarians. They see Transylvania as an inseparable part of the Kingdom of Hungary. Uniting it with Hungary proper under a single administration was one of their main goals. And it has a large Hungarian Szekely population at its eastern edge which would be at the heart of this new Romania. So it would become a source of anti-Habsburg sentiment and Hungarian irredentism and we saw how well that played out post WWI.
They felt that strongly about it? Crap. Not knowing much about it I was assuming since it was the last of their 12 points that it was their least pressing demand. I mainly wanted it simply to get rid of an ethnic minority and to keep Russia out of the Balkans.
My general idea that I mentioned further up the thread was that Maximilian use the fact that they're already under military rule, blame any past blunders on previous governments and play up the emotional blackmail of a Hungarian nationalist killing his brother and rightful ruler for all it's worth to get a much better for himself than Franz Joseph got. He's got three and a half years to hash out a deal and get his house in order before the Crimean War comes to an end which I think should be enough. I wanted to split Croatia, Slavonia and Transylvania off but if we can't get that maybe just Croatia and Slavonia? They seemed to be fairly loyal and if you combine them into a single Kingdom and give them a few minor concessions it might be enough to buy them off. Hell, even if as a liberal he just makes sure the Hungarians can't politically disenfranchise their ethnic minorities it'll still make things so much better in the future.
Other than that I like the idea, maybe they just give up Bukovina and force the Ottomans to cede northern Dobruja to secure the 'neutrality and open passage of the Danube' or something like that. So basically a slightly larger version of OTL pre-WWI Romania as a buffer between Russia and the Ottomans.
Good enough. Locking Russia out of the Balkans might not be enough to avoid the Balkan Wars, although if they don't have a possible land route then they can't support the other countries as much which might change some things somewhat, but it can certainly do away with the Russo-Ottoman War of 1877. As long as Austria makes a stable peace with the Ottomans, and I think they would since going to war with them gains them nothing of any real vlaue, I think they'd both benefit from this. And as an added bonus IIRC the Duchy of Bukovina was pretty poor so getting rid of it wouldn be no real loss.
One point. How will Max's military appointments compare with FJ's?
FJ's were awful, typically court favourites like Gyulai. Max is hard to predict, but it's an encouraging sign that Admiral Teghethoff, the victor of Lissa in 1866, was his appointee.
As you said Franz Joseph's appointments were awful, even if Maximilian only goes for mediocrities that's still a pretty big improvement for the Austrian military.