OK, it's certainly not the best game in this genre, but now that so many games have been mentioned, I have to throw in Beasts & Bumpkins.
It's certainly not a better game than Setters 2 or Anno 1602, but it is absolutely charming and has so many unique quirks. The game has a day/night cycle and seasons - night comes after each season, so it's fall - night - winter - night, etc.
In order for new people to join, a male and a female have to go into a hut during the night, and the next morning, a baby is born, which will first be a child, then a grown-up, and finally a granny or granpa, before finally collapsing. And you need to have a priest who buries them, or else the plague might break out in your settlement with corpses rotting on the street. Or you can just send the old people into the woods, where they'll be eaten by wolves, or into the enemies camp, when you see their death approaching.
This idea of people actually aging is very underused, IMO. It makes for some "last stand" situation, where you fight the enemy with an army of kids and grandpas throwing stones.
And people don't always follow your orders, they also commit crimes, like theft and even murder. Thus, you need to build a prison and decide on different punishments (prison, torture, death) for different crimes.
The games economy is a bit simplistic compared to Settlers, but it is so full of fun ideas to make up for it.