Naval gunnery was still in its infancy during this era and as such ship engagements tended to happen at extremely close ranges. Technically most cannon were capable of sending a ball of iron out a thousand feet (300m) if not more. However, due to "windage," gaps between the projectile and barrel, it was all but impossible to hit a target accurately or with enough punch left to be of any value unless the range were a fraction of that distance. Rates of fire averaged out to about 2-3 volleys every five minutes, an eternity for FPS fans, but from gameplay standpoint I think it's fine since the long interludes between broadsides allow the player time to plan their next move.
Despite all the deadly weaponry brought against sailing ships and the men that inhabited them, sinking as the result of enemy fire was a fairly rare occurrence. Wood, after all, is naturally buoyant and patching a hole in the hull quickly enough to prevent catastrophic flooding was well within the ability of a skilled ship's carpenter. Because of this inherent resilience, and relatively safe placement of powder magazines, a much more common outcome was crippling caused by the destruction of masts or rudder control. A warship that can't maneuver is like a soldier who has his hands and feet lashed together. In such cases the only sensible course was "striking the colors" or more simply put - surrender.
So, overall there are a lot of layers to this onion, from the strategic decisions made by the admirals to the tactical ones made by individual sailors, game designers have a wealth of material available to them. Some might look and cry that the time period is a huge knotted mess, but to me it's a wealth of opportunities as deep as the sea. You just got to grab a piece of thread and go from there.