[thejeff]

The castle building magic sites could be removed, as could the spells.
Events are rare enough that you couldn't count on them.
You could also just make a rule that any castles gained, even through conquest would be destroyed.

Spies wouldn't be used much, I suspect. It's easy enough to patrol one province and you'd have to waste turns at your only castle to build them.

I suspect it would just come to favor mobile recruitable SCs even more than the game does now. Research would be slow, since you've only got 1 reliable source of mages. National troops would only be recruitable far from the front lines. Nations that rely on lots of cheap mages would be handicapped, those focusing on powerful cap-only ones would be okay.