In 1881, at a Royal garden party in London, there was a question of precedence between the Crown Prince of Germany and King Kalakaua of Hawaii. The Prince of Wales (the future Edward VII) insisted that King Kalakaua was superior as he was a King and not merely a Crown Prince, even though a German Crown Prince was clearly a much more important person geopolitically. Edward commented "Either the brute is a king, or he's a common-or-garden nigger; and, if the latter, what is he doing here?". Source David Cannadine, Ornamentalism: How the British saw their Empire

Edit: Should add that neither was a subject of the British Empire, but it does give an illustration of the royal attitude.

2nd Edit: It's worthwhile following that link for a discussion of how this comment was, in context, anti-racist.

Only English peers were guaranteed seats in the House of Lords.

Scottish and Irish Peers elected a minority of themselves to represent the whole Scottish and Irish Peerage, a bit like hereditary peers do today.

The British established a complicated hierarchy for Indian Royalty, based both on how large the domain they ruled was and how long they had been British allies.

However since they had no voting rights in Parliament nor were ever considered British Peers, and they all had to defer to the Viceroy of India both politically and ceremonially, who was always a British Peer, it is a very safe assumption that they were ranked below.

If anyone here knows where they were sat during coronations in Westminster Abbey (with the British Commoners or with coronet-wearing peers and their wives) that would probably give a definitive ceremonial, if not political, answer.

This last sentence is speculation, but to a Victorian, the idea that an African Chieftain living in an unusually large mud hut would have been the equal of a British Peer, the 19th Century equivalent of a senator of the Roman Republic, someone entitled to vote and make speeches in the House of Lords in an era when it was still the dominant house and Britain the greatest Power, would have been laughable. Like saying that the leader of an Indian reservation is comparable in status to a US senator today...

In short, Victorian snobbery and awe of the aristocracy combined with Victorian contempt for non-white and non-protestant peoples make it unlikely enough for me to feel able to make a top-level comment..

Also a second, related question, were there any European territories that were conquered that had aristocracy. Were the local lords folded into the British aristocracy or deported?

In a west African context, the British only really had a solid colonial presence in sub-Saharan in the late 19th and early 20th century. African colonial provinces were generally ruled through a system known as indirect rule. Indirect rule was system pioneered by Lord Lugard in what is now Nigeria and involved signed treaties with local chiefs and rulers in which they became a colonial protectorate under the British Empire. The local chiefs would often keep a position of power under the British in return for their loyalty and the loyalty of their subordinates. The methods of coercion the British used to acquire such lucrative treaties were another matter entirely.

Under such a system local rulers were not really integrated into Britain. Traditional power structures were kept largely because it was easier to manage a colonial province, rather than out of respect for the lineages of chiefs and rulers beforehand. I am not really read on Indian history but from my limited knowledge this is a major difference between Britain in Africa and Britain in India.

Now I mentioned Lord Lugard earlier as a pioneer of British colonialism in Africa, he was also (as one might expect from his title) a member of the British peerage. Lugard was a Baron one of the lowest ranks of the peerage so at first glance all African rulers under him were below the Baron. However, Lugard ruled not as Baron of Nigeria but as Governor of Nigeria.

Lugard wrote a very useful book The Dual Mandate in British Tropical Africa in which (among other things) he discusses the nature of indirect rule and the hierarchy system in place. Simply put, the Governor of a province was the highest position and all chiefs were subordinate to him. Sometimes (as Lugard mentions) the Governor would also be a "Paramount Chief) residing above all other chiefs (giving him status above extra-colonial Africans too). So, in truth it would be inaccurate to call the African chiefs members of the British peerage, they were essentially local leaders that the Governor dealt with to manage the colony who existed outside of the British peerage system.

A related question; were any of the American founding fathers British peers, either by birth or otherwise? Were there colonial aristocratic estates; for example, was there ever a Duke of New York or Virginia?