Maybe this was intentional from the devs to balance out the castling strategy for this nation a bit.
I am no expert R`lyeh player,but as you say,the Watch Tower seems very well fitting...maybe too well without all those Hybrids spawning up and annoying you
Faerun is also an extreme situation ,because of the massive amount of provinces...and extreme situations always require different/more brutal approaches.
btw I used the disband option in AOW2/SM also a lot,this option is clearly missing here.