1) Take something for stress :). It's just a game, and this particular game takes a pretty hefty dose of luck at the start of it. If the first 5 turns absolutely screw you, then you might want to restart, at least until you're confident enough for the challenge.

2) There are different "phases" of the game, and at the start phase you are correct in that mining / foresting / etc. are not viable. Neither is building an army from your population, you need them just to keep your economy going. Right now you need mercs, and merchants. Firstly you want to hire a good squad of mercs, ideally something like 100 swordsmen (luck dictates when you get this chance). These guys can crush any peasant resistance, and probably bag you about 4 new counties before they're washed out. The important thing is to minimise losses when fighting then enemy. The overlay you want up is the Heart overlay, this shows the enemy confidence. When that drops to zero, the enemy will run away if they aren't fighting. This means that when that morale hits zero, the best thing to do, and counter to what you'd think, is to move your men back a step. This releases the peasants to leg it, meaning you don't take losses needlessly wiping out the enemy. Sometimes with multiple groups of peasants you need to do this once per group, as they hit zero.

3) For your first few shires, especially your starting one, eventually aim to have a varied food production, but make cattle the bulk of it. To start with you need to ditch the grain (I think you're forced to take in the first harvest, then move completely onto cattle and sheep. The most important thing is to get as many sheep in as possible before the spring turn (and on no account must you ever eat the sheep). This is tricky, as the flock you have is not self sustaining, once you've got enough cattle to cover your feeding needs, invest the rest in sheep (for both cattle and sheep, you need to buy more, the starting herd & flock are not enough), you need enough that the spring "boost" covers your losses during the other seasons. Why do you need the sheep? For the wool. Every spring you get equal wool for each sheep you have. In the early game wool sells for about 25, so with 20 sheep you're looking at a topup of 500 every year, get that flock up to 50 and you're going to get enough money in to fund the mercenaries from 2).

Every turn, balance out those sliders so there's just enough, make sure you're always growing your herd and flock (spread them out so there's 2 animals per field), dump the rest into serfs (this may seem pointless, but there's an invisible meter for field reclaimation, and every additional serf is moving that in the right direction. At some point you might want to stick in a grain field or two, it's not dependable enough for a food source on its own, but can act as a useful top-up, and means that when you exceed your food limit you don't enter the death spiral where you're eating your cattle, thus reducing your dairy output, thus requiring you to eat more cattle. It is also useful to be able to send it off to a run down county that you take over.

4) Expand early, this is why you might want to restart if you get some bad luck. It should be apparent how important your wool income is, so imagine if you had 4 shires, that means 4x the income. So throw caution to the wind, and your mercs at the peasants. Get about 4 shires before bothering to defend them, hopefully you're far enough away from the enemy that you won't be attacked for a while yet.

5) Once you're up to 5 or 6 shires, and have nursed them all to good health, you can start producing some iron, wood, and eventually weapons. By this point you should have the excess workers that you're able to do this. The important point is to dedicate each shire to production of one, at most two resources, the experience modifier is huge, and far from taking 10 turns like at the start, I've had shires that produce 2 of a resource each turn but it takes time to build up. You eventually want to be producing proper troops, the mercs are good for early expand, but cost a fortune to maintain. Use mercs to charge the enemy, and your regular troops to clean them up.

6) I didn't bother with castles, as you say - they cost too much. Instead I just countered the enemy with my own armies. When it comes to beseiging castles, build trebuchets, and only trebuchets. You can position them as far out as possible while still hitting a wall, and within 4 turns you'll have defeated the castle. For this reason there's little benefit in trained soldiers while seiging (you need some otherwise the enemy will just attack you), the bulk of it should be peasants building the trebuchets.

7) by the mid game you're pretty much unbeatable, the enemies will gradually fall, and you'll find that the micromanagement of your shires is the biggest problem. Don't appoint the guy to look after them for you, he does a terrible job. There's a definite tipping point to the game where you'll have enough behind you to just stock up on men and fortify your advantage before pouring out and destroying them.

Hope that helps :)