thejeff,
It seems our biggest difference could be due to the maps we play in.
As to your other points, please note that recruiting sacred troops from your capital does not exclude you from recruiting dawn guards (or even chariots
) from your other castles. So it does not affect your ability to fight far from your capital or when you take losses on your sacred troops (although you should try to minimise the latter as much as possible). I am often forced to fight with armies without sacred troops at some provinces, but the sacred troop armies does give you a significant if not decisive edge.
Also, the points used to get a bless is effective throughout the game but the points used to get P3 is only meaningful in the early turns. So the 160 point difference vs better early game expansion is not that unfair. Furthermore, the F4E4N4(6) bless is not bad for the SCs even though it might not be the best (as I was looking for a bless that work with both an not just optimised for SCs).
Finally, with growth 3 scale, the pop eating is not noticeable until late in middle game - but even then the pop is still growing virtually everywhere. I did not notice any troop eating although it might have happened occasionally. The picture might be different if you use P3 instead of S1 as you would be recruiting on average an extra sacred troop or even two per turn.