Regarding AC and Hell:
The Armageddon events have been changed and rebalanced multiple times:
Here are the current effects as far as i can remember (a bit unsure about the highest events because i seldomly to never reach armageddon or even long past blight...):
AC 10:
Just a warning no negative effects yet
AC 30: Blight hits.
All cities get a lot of random unhealth based on city size and buildings which give health. The unhealth reduces by 1 for each turn after blight so that after ~30-40 Turns even the biggest cities should be back up to normal
(it might be a good idea to fill your foodstores beforehand and if possible to get some food improvements up + adopt food heavy civics to compensate. That may enable you to get through the whole thing with minor starvation. If you don't take care you very well might end up with a lot of size 1 cities...)
Hits everyone and the AI will also suffer badly from it (Infernals excluded...)
Also if the AC is above 40 a random event called pestilence might occur which is some sort of mini-blight with simmilar if less drastic effects (may occur multiple times.)
AC 40
The first Horseman (Stephanos) appears. An extemely powerful flying Barbarian Unit which will very likely convert living units losing against it with high power and fear (which will make your units unable to attack this one unless they can muster the courage...)
AC 40-70
the other 3 Horsemen (Buboes, Jeresia and Ars Moerdi) appear (similar to the first horsemen but with differing effects). I don't know the recent exact AC counts they do appear
AC 70
Hellfire spawns all around the map and some Demonic Axemen on them (if the Infernals are in the game i believe their control will go to the infernal player. Otherwise they will be barbaric.)
AC 90
The Avatar of Wrath appears (big bad unit sommoning 4 further demons [Ira] which he can replenish at will up to 4) also many of the worlds units will turn enraged which means they go AI controlled and try to attack a target nearby regardless of odds
AC 100 Armageddon
All cities Populations get halved and a big part of the worlds living units will die. (The dieing living units + population mean that the Infernals and Mercurians get tons of Manes and Angels which will result in a titanic "final" battle between the Angels and the Demons. Hence Armageddon...

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(the intent of the Armageddon-features is to break up the late-game stalemate and aggravate conflicts between good and evil to the extreme.
Possibly culminating in a worldwide clash of the souls of the good and evil people of Erebus in form of the Infernals and the Mercurians at AC 100.)
On Evil Civs / Civs profiting from a high AC:
Generally spoken Evil Civs just suffer the same drawbacks as everyone else (unless they actively seek Armageddon aka running the Ashen Veil which means some drawbacks can be mitigated...) even earlier than everyone else.
So overall they are even more! prone to suffer from the drawbacks of a rising AC then the others
Armageddon overall is a "drawback" to evil behavior (like razing cities, spreading Ashen Veil).
Something in lieu of a payback for the short-term gains the evil behavior grants.
There are some exceptions though:
Leaders with the barbarian trait and still at peace with the barbs are not attacked by the mighty barbs appearing at certain counts of the AC (they still suffer all other drawbacks though which are not that many).
Civs running Ashen Veil can adopt the Sacrifice the Weak social values category civic. Which allows them to feed their pop for one food each instead of 2. Thus mitigating the dwindling food supply aspect of the AC events. (Also their relgious units are partly undead so those units are unaffected by the armageddon Events. The same counts for the religious units of OO, but there the advantages are so minor that they hardly outweigh the benefits...)
The infernals cherish the rising AC and have many advantages of a rising AC without suffering any of the drawbacks. When playing them you will want to increase the AC as high as you can.
The Sheaim (an armageddonite bunch which leaders actively want to destroy creation by causing Armageddon either because they are completely immortal + indestructable and tired of life (Os-Gabella which sees destroying all of creation as her only way of ending her existence) or coerced (by the fallen Angel Ceridwen) into damning the rest of the world to safe them from eternal suffering (Tebryn Arbandi)) which profit in many ways from a rising AC (most notably a big part of their military spawns from a building called planar gate which will spawn more units more regularly the higher the AC gets). Its still to be taken with caution though since the negative effects still happen...
The main force of some civs consists mostly of non-living units. Those units are immune from either death by Armageddon, the damaging effects of blight and the fear and terror which makes the horsemen so hard to fight or turning enraged at AC 90 when the Avatar of Wrath appears.
Thus those civs have real tactical advantages from driving the AC up all the way up to Armageddon damning everyone else while just getting merely scratched themselves thus tiliting the power-axis greathly in their favor.
Most notable here are the Infernals (they also get many other advantages as noted above), the Mercurians (they also get a huge power-boost from Armageddon when all the good souls dieing in Armageddon turn to them + they are usually immune from hell terrain), the Luichirp (Which have a huge army of golems. They might still suffer badly in terms of health and improved barbarian activity but that isn't all so bad when you got a huge army of golems while everyone else has their whole army evaporating or fleeing in terror from the horsemen. If they stay good they are even immune to hell-terrain.) and to a much lesser degree the Sheaim (creatures from gates and their summons are mostly non-living) and the Balserapsh under Keelyn (their summons are mostly non-living)
All those civs might have a real and huge incentive to actively push up the AC.
Important note:
Evil here is to be seen as acts which help Agares (former Angel of Hope, Now Angel of Entropy) and his band of renegade Angels which try to turn Erebus into hell to prove the One (the entity which created the angels and lots more) that he is wrong.
This can either happen directly (Armageddonite behavior aka spreading the Ashen Veil or choosing outcomes of random events which actively raise the AC usually for a short-term gain) or indirectly (behaving badly without caring much about the outcome. Like the calabim doing their evil things to the rest of erebus or going on a razing spree in times of war.)
The good civs are those that actively combat the deeds of the evil fallen Angels and their followers
The neutral civs are the ones who take no active part in the conflict. (the effects of Armageddon might prompt them to take sides though thus turning good or evil. In lore as in game. In games that translates into adopting the Ashen Veil or the Order religions. Which turn their adopting civs evil / good.
That might also be true for some of the usually evil civs like for example the Svartalfar which might try to turn to neutrality or even goodness to prevent their treasured forests from being vanquished by hell...
Or going all out with the Veil and thus forfeiting their forests in exchange for greater corrupting power and dark secrets only parted with the most corrupted of minds.)
In FFH2 good and evil are more labels of teams regarding a civs standing in the war of the fallen Angels against the One and the angels standing by his side. Not so much a question of behavior alone (there are clear correlations though but it should always be taken with a big pinch of salt...

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So in FFH Good = "good" not "GOOD!" and not every evil civ = "Evil!". That said most of the evil civs behavior is rather quite appalling overall.
On good end of the spectrum the the lines are much more blurred here (especially if you take the religion which turns everyone adopting it to good. Those Order followers are mostly fanatics valuing Unquestioning Obedience (in big bold letters) above all else. And their methods of redeeming evil might turn quite radical. Especially in circumstances which are represented by a high AC or if combined with some civs starting good or otherwise...)
And if you take the neutral Civs into the mix that labels of good and evil totally becomes inept to describe their behavior beyond what side they take in the struggle of the fallen Angels against the One. Since there are quite some civs/leaders there which you might well describe as nicer than some of their good counterparts
(prime example here might be Cassiel of the Grigori vs. Basium of the Mercurians. And the 2 sure don't get along as well.) and some rare leaders which have an even more questionable behavior than some of the "evil" leaders. (Hannah the Irin or to a much lesser degree Valledia the Even (if you are a tool in her schemes or cross her) might be a worse "boss" than Auric, an evil Decius, Faeryl, Sheelba or Mahla provided their underlings are "in-line".)
All that said in the context of a dark world like Erebus some of the appalling actions of the good leaders / civs / religions might make much more sense.
With hordes of demons and undead going around committing wholesale slaughter + some civilizations committing the most appalling of actions (Sheaim and Calabim as well as Doviello under Chardaron might be prime examples) and the world turning to hell dragging their feet nonaction might not be the "best" of values.
Its important to understand that description of good and evil in terms of FFH 2 to get the lore right and understand the context of the Armageddon mechanics and the labels themselves.
Hell spread works as follows if i remember rightly (The hell count for a tile determines if a tile is hell or not and will rise if hell is near and if the needed AC-threshold has been reached. Anything from 1-10 is normal terrain, anything with a hell count from 11-100 is hell terrain):
In Infernal territory the Hell count is always set to 100 each turn. Hell won't enter the game usually until the infernals enter (the Chaos 3 spell Wonder might be another source but that is random and usually unlikely to appear prior to the infernals enter the game. Still possible though. Still another source might be an entropy mana-node flare. Mana flares are random events sometimes if very seldom happening around improved nodes...)
Also the Ashen Veil is spread to infernal cities each turn and they start with it founded should it by some way be removed from their cities.
In non-Infernal territory that belongs to civs which run the ashen veil religion hell will allways spread (so the AC threshold for them is technically 0)
In unowned lands (Barbarians count as owned evil-civ lands for that reckoning) hell will start to spread at AC threshold of 20 (i believe, could be 25 as well)
in evil leaders lands hell will start to spread at a threshold of 40
in neutral leaders lands hell will start to spread at a threshold of 70
good leaders lands are immune from hell spread no matter the AC.
In Mercurian territory i believe the hell count is set to 0 each turn (could err here though. I very seldomly touch them or the infernals either in summoning them or playing them myselves). Also the Ashen Veil religion is purged from Mercurian cities each turn if it should spread to one.
If territory changes the threshold for hell spread will change as well. Tiles above the threshold + hell themselves or with neighboring hell tiles will have their hell count rise. Other tiles will have their hell count fall. non hell tiles with a rising count will eventually turn to hell and hell tiles with a falling count will eventually turn to non-hell territory.
Sanctify (Life 1 spell) will set the count of the tile its used on and all surrounding tiles to 0.