Good religions have a big advantage : never the hell terrain will spread to them. There were discussions in previous threads which showed the superiority of farms over cottages, so I think evil and neutrals have a sufficent drawback. And Sphener isn't THAT bad. (I maybe don't remember correctly, I mostly play the Clan, following Bhall's religion(AV)).
Octopus Overlords could most certainly use some kind of bonus, be it a heroe, a wonder, or a doctrine.