Screwtype,
I think you are on the right track. I'm not sure if a ZOC will work on the scale, but I do agree more realistic will amke it better.
I also agree artillery is too powerful. I think artillery reducing the city defense is correct and well don. I think the problem is the collateral damage. Maybe instead of having crazy powerful artillery, we should give ALL units some collateral damage ability. That is, putting too many units together gives them a lack of mobility. Or reduce defense if there is 'overstacking', or some other mechanic.
I didn't mind 'suicide' catapults since seige equipment was always disbanded -- that is, ancient artilelry was always 'suicide'. (the Colossus was built out of Demetrius' seige equipment). I think the problem is that they do too much collateral damage.
So, ancient artillery really should be made only on the spot and always eliminated, should be very important against strongholds. Some other tactic should prvent overstacking. 'Real life' would be putting in food restrictions and disease -- here we have to use them or find another solution.
Best wishes,
Beunor