Of course it's not truly overwhelmingly powerful. If it were, we'd read a lot more about cruisers winning games for people ("Then I researched Dynamite and game over," etc.). I start my "other continent" attacks with frigates, because they absolutely do the job. What cruisers do, as you point out, is give you a knight-style edge early, if you beeline for them and neglect the upper half of the tree. But even that edge has limits: knights can attack more tiles, and cruisers are more likely to require attack-ending repairs, unless you have a heavily promoted, admiral-heavy navy.