Cassiel does not deny individuals the right to worship false gods if they so choose. Although the Grigori people tend to look down on and mock those who choose to be devout, their constitution forbids the persecution of anyone based on religion. Cassiel is very much against having any official religion, as well as having individuals use force or threats to manipulate others into accepting religious authority. Religion cannot be used to excuse extortion, theft, or murder. Peaceful evangelism is however not forbidden. The situation of the Luonnatar is not unique. The religion of any god would be accepted and protected under similar terms. Although the state will never sponsor the construction of one, temples of the major religions do exist in some Grigori towns and neither parishioners nor clerics content with freely given donations are punished.
If Cassiel had renewed his fealty to Dagda, God of Force and Angel of Balance, just before his death, that would not have stopped Auric. He would still have his body broken and blood spilled in the ritual leading to ascension performed. All it would have done was allowed Cassiel's soul to depart to Dagda's vault, where it could slowly regain the strength required to physically manifest again. (Many witnesses believed that Cassiel would return at once, but Sabathiel took centuries to regain his strength after centuries in hell and Cassiel's wounds were probably more serious.) By turning to Dagda Cassiel could have saved himself, but not his people. He would have also betrayed all of his principles, and left his people no basis on which to rebuild themselves.
That said, even without returning to Dagda, Cassiel did retain divine powers which he could have used at any time if he chose to do so. We know that he has the power to heal plagues (and thus presumably also many of the wounds his soldiers suffered while defending the homeland), but chose not to because he would rather advance medical knowledge than risk being worshiped as a miracle healer. I don't know that he could have stopped someone already well on his way towards godhood, but if he had personally joined the melee he could have used his superhuman strength (he is of similar strength and stature as Basium, although likely not quite as effective a warrior because he spends his time in study rather than training in battle) he could have made a significant dent in the enemy armies. This would still however risk making his people too dependent on him, and less able to go on once he eventually left them. His sacrifice did lead to Auric leaving the Grigori alone long enough for them to rebuild. In fact, after his victory Auric never bothered the Grigori again.
Actually, now that I think of it, it is possible that Cassiel did choose to use his divine power to work a great yet subtle miracle as his final act. You see, the true power of Dagda and Cassiel's sphere of balance was the making and enforcing of contracts. Cassiel could not simply force Auric to leave his people alone, but he could force him to keep an agreement which he freely entered. By demanding that Auric leave his people alone as he freely surrendered himself, he set up an implied contract. By taking what he most wanted from the archangel, Auric assented to Cassiel's demand. Auric may have not been the only one sealing a spell in angel's blood that day. The same sacrifice that lead to Auric's Ascension may have created a new compact between the two of them, perhaps strong enough to keep even a god from assailing the Grigori people ever again. If Cassiel had in any way resisted, their agreement would have been made void and his people would have no promise of safety. If Cassiel could have held off the Illians, Auric might have sought and used the blood of Brigit instead, not only eliminating his spheres greatest remaining enemy but achieving ascension without any sort of protection for the Grigori.
