is a guided missile is supposed to be like exocet or cruise missile? i would think those would be very effective against ships with no antimissile missles and point defense gatling guns. i would see those as promotions a ship would need in order to survive a guided missile attack. maybe thats why the current missile is weak; its taking into account its a relatively slow speed missile, representing a number of missiles being launched than just a single missile, and the fact that many if not most of those missiles got destroyed (shot down) by defenses that ships and cities are assumed to have by that stage. personally i think if you are able to fire guided missile against ironclads or frigates or even lower tech ships it should be a instakill. who is really going to put antimissile systems on a galleas? against a carrier or battleship or missile cruiser it should be representing multiple missiles launched. a battleship or carrier might survive a missile or even 2 being hit but i dont think a missile cruiser would necessarily survive one hit, nor destroyers. so for them it should be doing either miss or hit; and if a hit depending on the target type either a kill (missile cruiser or destroyer) or random amount of damage up to and including a kill on carrier and battleship, along with any missiles or aircraft they are carrying.
land units in cities its about right imo. the units will not be grouped in one place for easy destruction by a single missile. the city may even have anti missile batteries.
units out of cities maybe it depends on terrain its in, how much damage is done?
I think guided missiles (if we think of them as cruise missiles and such) would make most sense to use against cities, and vessels. The vessels for the reasons you already talked about, and cities because well ideally in real life you'd probably want to to use them against military bases and such and not straight up cities, but in the game military facilities are theoretically built within the city so yeah. I know that cities could have anti-missile defense but still.
What if you could launch guided missiles at enemy territory; not just cities or units? Like you could target mines, lux resources, and manufactories and such with them, and the effect would be that it's like pillaging them. You wouldn't get money and such from pillaging like with a land unit but it could have it's uses. Maybe if you're going to start a war, you could do it by striking their resource improvements with guided missiles so that they start out at a disadvantage. It wouldn't be necessary for a/some cities you'll move against immediately but perhaps if you have a couple subs or cruisers within range of cities which your land forces wouldn't capture for awhile, the effect would be better. Though this is probably a stupid idea.