I have successfully manipulated a second holy city in the same locale as the first, but it required a couple of very specific conditions:
1 - All cities must have the same number of religions (the algorithm always chooses cities with the least number of religions) or the holy city must have fewer than all the others.
AND
2 - The holy city must be the biggest non-capital (Bigger cities are favored by the formula) by some margin. With Confucianism in both cities, Taoism was founded (in my example) in the holy city only after whipping the population in the second-biggest non-capital to well below the level of the holy city.
I have the saved game here where you can play with it to find the exact amount which must be whipped off at Pasargadae to get the Taoism holy city in Istanbul. (When I played it I took no chances, whipping off five pop for a building, which had the desired result) There is a GS in Persepolis to found Taoism, so it can be tested quickly and easily.
And yes, I know this game is already won. (well, not literally, but one would need to be an idiot to lose from this position)