The objective of this process is to produce a simplified representation of a CK2 realm—for a map in an AAR, or for manual conversion to an EU4 mod.
England at the 1337 start date (as of CK2 version 3.3.3) will be used as an example. All example boxes presented below include diagrams of the title tree as it is formed, step by step. The example boxes for steps 5 and 6 additionally include maps!
Create a tree of titles, following the in-game interface (click on the shield of the top title). You probably want to ignore baron-tier titles, but nobody's stopping you from including them!
Adjust the tree to properly show situations where a ruler holds multiple titles at his primary rank. Make each non-primary title at primary rank a subordinate of the primary title of its holder, and label the non-primary title union de facto.
Label each title (except the top title) as either union or vassal. (Skip the titles that were labeled in step 2.)
Label each title (except the top title) as either de jure (meaning both de facto and de jure) or de facto (meaning only de facto, not de jure), based on its relationship to its direct liege title. (For titles that were labeled in step 2, skip this paragraph, but don't skip the next paragraph.)
If a title is not a de jure subject of its direct liege title but is a de jure subject of an indirect liege title, additionally label it as a de jure subject of that indirect liege title specifically.
Collapse each title into its direct liege title if it is a de jure subject of that direct liege title. Continue iteratively until there are no more de jure subject titles in the tree.
For additional realism, you can assume that a vassal de jure is controlled by powerful subnational entities (i. e., is in an EU4 estate—nobles, burghers, clergy, or tribes) if it is only a single rank beneath the liege title, and that all unions de jure and all lower-tier vassals de jure are under the authority of the centralized government (i. e., are in EU4 states). See the MEIOU mod for details.
Also, if a liege title has an elective succession law where the votes are based on titles (e. g., elective gavelkind or princely elective, but not imperial elective or eldership), never collapse any titles into it! You still can collapse lower titles into other lower titles, however.
Optionally, you can manually tweak the directions of personal unions (in the out-of-game tree or with console commands in the game itself) if you think their original directions are nonsensical or ugly. However, don't forget about stuff like the King in Prussia trick: it's entirely plausible that a vassal character will want to keep his secondary titles shielded from his liege's inspection by forcing a de facto relationship!
As another example, here's the HRE at the 1337 start date (as of CK2 version 3.3.3).