[Velusion]

There are a number of tactics... but like Helheim or MA Vanheim a all out bless rush is really hard to stop.

With Niefel you need to raid him wherever you can and avoid thier main forces unless you have the right troops/magic.
If you have astral casters go strait for the Soulslay, Enslave spells.
If you have fire go strait for Evoc fire AE spells.
If you have neighbors convince them they need to attack Niefel as well.

Really, the moment you find yourself next to niefel (or helheim or Vanheim) you need to immediately switch what you are researching to something that will work against them. Good combat magic is their weakness.