[Illuminated One]

It's my intention to boost capabilities early and reduce them late. And I think you are giving one answer yourself - just making spamming mages not necessary isn't enough to stop it. Ideally imo every unit, mage or soldier, should be recruited for a particular reason, not just for a very generic and obvious reason (mage=research=good in any case). For that to work there must be a cost associated with recruiting and gold shouldn't be aplenty.

There are some problems I need to tackle still (forges and rituals as you say for example) but this won't happen in the course of this game.

Now, to the nations. I think what matters is concerning balance, where did the nation stand in vanilla and where does it stand now.
The point about the differences between sacred and nonsacred research as a hidden boost is very important, thanks for working that out.
There's one thing, though. In vanilla cheap research=powerful research in the long run, while in this mod it's two-dimensional. If I were to copy consistently along the lines of Kailasa was cheap and good some nations would just reap it all and others be f*****.
And of course it gets a bit chaotic when weighting costs against the benefit of having higher research.
I would see this as problematic if a nation would get both hidden and obviously boosted/penalized, but except Arco I don't see any.