Phew, I have figured out how to restore the feature of using certain yields to do research, so it is not missing after all

Apparently there just needs to be <iCosttoResearch> as well as <RequiredYields> for this to function. I think it will be interesting to let advanced yields be inputs for researching certain techs which give an in-game advantage. That way there can be good strategic reasons for wanting acquiring certain good types, not just to always sell everything all of the time. I'm still clueless about improving the python screen format, maybe I should PM platyping but I'm not sure he even does Civ4Col related stuff.
One other python thing I've really wanted to add is some way to make the tiny Yield icons more clear to players. For mods like this, M:C, and RaR with lots of new yield types it's hard to tell from the little yield icons in pedia and other screens what that yield is. It would be good to add the yield's text name in some Pedia screens or maybe enable a mouseover tooltip to show the yield's name.
The mods that have used Domestic Markets include RaR, Androrc's mods, and old 2071; I am not sure how they balanced things, but I probably just did it how I felt was most appropriate for the units and could try to be more systematic in future lol. The big benefit from allowing local prices to adjust based on supply/demand is that creates a powerful self-balancing mechanism which should help a lot. As a starting point you could let each unit demand one or two of the processed good types, whichever you think are appropriate (e.g. Ale could be favored by working-class unit types while Wine could be favored by upper-class ones. I know Monks like their booze for sure!

). Not all the goods have to get a demand; if you want you could have only a few of the goods be consumer goods and the rest be traded normally. In fact it might also be interesting to let some goods such as Ale have relatively low prices in "Europe" and trade screens but generate a good amount of demand from your citizens, that way it could sometimes make sense to want to import some Ale from abroad.
The building demands as currently implemented could be an interesting option that lets some buildings consume or export certain goods (ie consuming some of your finished yields for gold, which is different from a citizen using raw goods to produce something else). I agree I don't think I would use building demands very extensively in 2071, but it would be cool for a few special cases such as a Smuggler's Lair that can generate demand for certain nefarious goods

For M:C, perhaps a Caravan Route could be a neat option that adds a demand to sell certain goods for export. But, I also think it's actually a good idea you had to add a buildinginfos tag that unlocks local sales of a certain good, for instance Tavern unlocking the local consumption of Ale & Wine etc.
I agree I'm not sure why the default total sales cap is so low, it could be higher for M:C which will depend a lot on domestic consumption. Still, you could use the chain of Market type buildings to raise this cap, it makes sense that towns with a larger Marketplace would be able to handle much more of these local sales.