I reported this a few posts back. Don't think it's been addressed yet.
I've tried to come up with a fix of my own but it might take a little too much time to test every theory
Some guesses
During the creation of cities without capitals by the settler unit, there seems to be a population error, resulting often in +1 population, which may cause some kind of error.
When the towns are constructed there may be random equations that aren't serverside (shared with only one client) and that leads to the OOS.
Nothing I've found explains the +1 citizen (not population) bug
Possible Solution: Change the plot radius restriction to a trait, remove the building from being created with the city (but allow it to be buildable). Thus making their city creation exactly like everyone else with the plot radius restriction handled in the traits.