If buildings were cheaper and more powerful, production and gold would effectively increase, which would lead to making too many units for the map.
What should be happening, is discussion on how to improve gameplay, to allow for increased strategies & options, and allow for a deeper more fulfilling gaming experience. ICS it has been argued is boring gameplay, The solution to that is not to eliminate or reduce ICS, its to find the root cause of why it is boring game play, and fix that. Additionally, Counters to ICS need to be placed into the, making it viable to actually compete with ICS in terms of small or mid sized empires. I would much rather see Civ 5 fixed by addition then subtraction as its current state is rather woeful.
Yes, the main reason large cities were made less productive than in previous civs is because of 1 upt. That's a funny analysis, 1 upt would actually be one of the reasons for ICS working so well (the second reason being too many game designs scaling with the number of cities, design scaling with pop already hurts because of a bad vertical growth, they had to add options to remove the penalities of mass expanding... I need an explanation here.)
If you push the analysis further, and prevent ICS as well, the end result is that you cannot grow vertically nor horizontally. This way you make the 1 upt work but the price to pay is that you completely destroy the city builder part.
The first suggestion is even worse than in the quote above. It might make founding the third city (when we are far away from anything like ICS yet) almost impossible since at that point of time you might not yet be able to cover the additional unhappiness.
b) Having "fixed penalties" for small cities doesn't help, as this can limit ANY growth of the empire, even when ICS was not intended.
As already said, to counter ICS, you need to make new cities less valuable, so you must nerf expanding at one point or another. Still, this is probably the best solution, and it would not be so destructive as you think for a 'normal' game play, after you first cities are developped you easily can expand. It would make for a very slow gameplay, true, see what I wrote just above.
ICS works even without maritime CS. It is just a little less effective.The main problem is first and foremost the maritime CS.
That's bound to fail. One of the advantage of ICS is that you have very few roads, for a larger number of cities.To fight the income from roads I would propose certain thresholds, after which additional, fixed costs occur (let's say for the road department). That way, after 10 road hexes there could be costs of additional 2 gold . After 25 road hexes there would be additional 5 gold, and so on (once again, the numbers are just for display purposes, and might have to be adjusted per mapsize).
This principle is similar to "inflation", yet is easy enough to be understood by the player and doesn't harm the early build up of your empire.