When European Crusaders retook Jerusalem and some of its surrounding cities during the First Crusade, they had intended to restore it to Byzantine hands, but the Byzantine emperor had betrayed them at the last minute, and that led to the Europeans setting up their own states in these cities. Rodney Stark calls these the Crusader kingdoms in God's Battalions, and on one use of the term "colony" it does seem appropriate to call these European colonies. But he points out that there are two different ways people use the terms "colony" or "colonial":
a. There's what academics often mean, which involves the colonizer economically taking advantage of the colonized or forcing them to convert to their religion
b. Then there's what most people mean, including some historians who regularly refer to the Crusade kingdoms (the political structures set up in Jerusalem and nearby by the crusaders when they overthrew the Muslim colonizers), which is simply one group of people setting up camp in another location, without thereby implying anything like definition a.
The Crusade kingdoms in fact couldn't fit definition b, according to Stark, because (1) the flow of money and resources went there other way (the Crusades were expensive, and all the money to operate the Crusader kingdoms came from taxes paid by Europeans to maintain the European presence in that religion and (2) they didn't force conversions or even treat non-Christians as second-class citizens the way their Muslim predecessor colonists had. If you do want to count them as colonists in the bad sense, then they're just the successor colonists to the Turkish colonists. Those who criticize the Crusades as part of European colonialism rarely apply the same reasoning to the Muslim conquerings that the European Crusades were a response to.
Stark is right so far as all that goes, I think, but he leaves out one crucial sense in which most academics will use the term "colonialism" that may well apply, and that's cultural or social colonizing. One culture is ruling over another and dominates. You might call it cultural imperialism. That certainly was true of the Crusader kingdoms. They allowed Jews, Muslims, and others to remain and practice their religions freely, for the most part anyway, but they ran things in a European feudal way, and the socio-cultural, including religious, perspective of the Europeans certainly dominated.
I think Stark misses that when arguing against the two components of colonialism that he says aren't present. But I'm also not convinced of the view of many academics that such cultural dominance and control is in principle bad. Isn't it what we do whenever we pass a law by majority consent that a minority might disapprove of (or in the case of Obamacare a majority doesn't even consent to). I don't see why that's in principle evil. Leaders should do what they thinks is best, and sometimes they may get it right when the people they're leading don't agree. That shouldn't necessarily stop them. If the different viewpoints happen to coincide with different cultural perspectives or tendencies, it still doesn't seem to me to make it wrong to enforce it. Other factors might make it wrong, e.g. if it's not good policy to begin with. But I've never been convinced that the consent of the governed or the cultural similarity or connection between governing and governed should be in-principle required for a government to be moral and just.
[Technically, "consent of the governed" is multiply ambiguous. It could be a requirement that the governed is required for every little thing, or it could mean they just have to approve of the representatives making the decisions, who are held accountable every so often. The U.S. only has the latter kind of consent of the governed, and it would be crazy to do much more, although there are ways that there could be more consent. It could mean consent of all the governed, a general consensus of the governed, a majority of the governed, etc (and any actual government usually requires a much more complex procedure for calculating it). I mean to say that I don't think any of these things is required for a just and morally good government, which I understand is a pretty radical view nowadays, but I think it's true.]
I think there's something missing from your definition 2, which otherwise makes your definition 1 incomprehensible. When historians of any stripe discuss "colonization," they aren't just talking about "one group of people setting up camp in another location." They're talking about one group of people, acting as agents of some political or cultural entity, setting up an outpost of that entity in a new area.
This aspect of colonization is often unclear to Americans because we tend to think of colonies as separate things -- established by fleeing dissidents, for example, and based on fundamentally different principles from the mother country. But when the American colonies were established, this wasn't anybody's perception; even the dissenting Puritans of New England were adamant about the Englishness of their colony in the New World. In fact, they were acting as legally chartered agents of the English crown, and were part of a master plan for establishing an English presence to compete with the French, Spanish, and Dutch colonies in the Americas.
I also object to your analogy between colonization and majority rule: "Isn't [cultural dominance and control] what we do whenever we pass a law by majority consent that a minority might disapprove of ...?" If democracy means anything at all, it means there's a fundamental difference between having a vote/representative in a level political playing field and not-having a vote/representative in a level political playing field, whether you win or lose the election. This distinction may be more fundamental in principle than in practice, but it's still basic to American politics. And the colonized, as the grammatical form of the term implies, are rarely equal participants in any sort of deliberative process about their future or the future of their land.
I suspect the first problem is present in Stark's own definitions, but I don't have a text copy. I was listening to it, and I tried to capture his reasoning from memory. But, to be fair, Stark means to be capturing ordinary people's understanding of a colony, not historians' understanding. He then does say that a certain historian known for calling the Crusader kingdoms colonies did not mean a but b, but your corrective may mean he meant what you said instead.
As for the second point, I think you have identified one key difference between the two. I still think it's a difference of degree, because there's a continuum from absolute control over your life from someone who allows no wiggle room to absolute sovereignty over your life with no interfering forces from outside, and colonization has more barriers than our system when you're in the minority. If I'm in a small minority, there's little real chance of getting my wishes on the things I disagree with the majority over. It's better in theory than not even getting a vote at all, but it's still someone else imposing their will on me.
I guess what I'm arguing is that they're not the same but that someone who is perfectly all right with our system might not think colonization is in-principle wrong, even if it's less preferred. I'm guessing you'd still disagree with that, but that's what I've been thinking.
I've got a copy of the book in front of me now, and here's the relevant passage:
It looks like Stark doesn't understand the point of Prawer's work. Prawer's work was an attempt to show that the crusader kingdoms were an early form of European colonialism -- a forerunner of the colonies that were to be established in other places in later centuries. Prawer thought the crusader kingdoms had crucial features that would come out later in more vicious ways. Stark's claim, that Prawer never intended to indicate that the crusader colonies were all that vicious at the time, kind of misses Prawer's point. Or so it seems to me.
Perhaps other people are also missing Prawer's point and Stark is just trying to correct those people -- but I see only vague allusions to these people in what you've posted so far. Does he cite specific people who have drawn unwarranted conclusions from Prawer?
That's actually all he says. It goes to a different subject immediately afterward. Maybe there were endnotes that cite some of the stuff he's criticizing, but I didn't notice any when I was looking at it. But I do think he intends to be responding to people who he thinks got Prawer wrong.