Few things:
Some of the more clichee options for evil are not available, but there are many options still. Read the description more closely.
Abysia has no doubt concerning blood sacrifices or crossbreeding humans with demons. They have succeeded, and have recruitable halfdemons in demonbred. They also have created humanbreds, entire race made to be slaves of the abysians, a race totally infernal in many ways. And you think this is neutral?
Helheim seems pretty evil too. And Niefelheim. A nation that *starts* with the spell that is most feared by the inhabitants, the one which will be their death unless someone manages to dispel it... Illwinter, the spell of eternal winter, has very flavourful and evil description. Are these neutral too?
You want an ancient and mystical beast? One that is almost impossible for humans to control and even those who have spent their lives studying it will often become mad when meeting it, or just die from pure horror? Haven't you ever used Void Gate or palyed R'lyeh? They could be evil too. Only if you think that sucking brains of humans and lobotomizing/slaving another humanoid race is evil, though.
Also, Dominions II has no beings called elves, and no beings called orcs. However, both Vaetti and Tuatha can be considered to be the mythical equivalent, and predecessor, of the elves Tolkien & co. have created in fantasy literature. Vaetti were called goblins in Illwinter's first game IIRC, and in other game they would just be an orcish species smaller than normal. All of them, as well as Jotuns/Niefel (hill/ice giants), Caelumians (bird people) and C'tissians (lizard people), have enough depth to rival some of their counterparts *in literature*! Pretty good for a mere game, that doesn't even have elves or orcs!
In short: Dominions II does not have the common fantasy clichees (sp?), it has a theme and roots deep in mythologies of different eras and areas. And not everything that looks like human is even close to being one!