If you can suggest a means of using terrain - any means - that is something to talk about. The debate isn't about whether or not using terrain is right or wrong or whether Civilization is right or wrong. The debate is that we don't actually have a suggestion to work with. We have an idea (use terrain!) but that does not yet translate into anything we can call a game mechanic.
Hey Sagittary, You commented in one of my earlier post that it seemed I had changed my perception on wheter terrain should be used to an effect.
Given the fact that terrain all converts to Fallen/Grassland (Empire / kingdom), we have to "rule out" any type of "city bonus/limitations" related to, deserts, swamps and artic. As only moutains, hills and forests remain following the land mutation.
Maybe there could be a few interesting concepts to visit:
(Terraforming the land for your Empire/Kingdom)
A little "history" / mise en scene:
* In earlier games it apparently cost you essence points to change the face of the land in order to be able to build on it. I think Frogboy's logic was that losing essence points was rather drastic. I agree that losing essence is a little too much.
* People have been complaining that expansion in the game is way to quick. (I love land rushes in early on in 4X Games, but I guess it's not for everyone)
* This being a 4X game, I think we should find a way to make terrain matter one way or the other. Or to find a way to tie in Terrain & Game mechanics while respecting the Elemental universe.
Concept:
It would be nice to see somekind of benefit/consequence/requirement about changing the face of the land before OR after you build your settlement/Buildings. Without it being too severe as opposed to being completely "free" and inconsequential.
Example A )
Before you can build your city, you'll need to cast a spell 'Infuse' the square where you wish you build your new settlement with a spell that will make it change to your faction's terran type. Rather than be able to build anywhere at anytime. One could also make so that, you CAN build on a square that has not been converted, but you would suffer penalties like 'less prestige, slower production, etc...'.
In this way, depending on if or not the city was built on "fallen" land, it will determine some limitations of the city. (50% prestige, population cap, building tiles cap?)
Example B )
After building your city, your area of influence slowly (overtime) starts converting squares of land to your faction and will allow you to build on those squares only. (Or do like in example A, buildlings built on non kingdom specific terrain will receive penalties to their intended purposes. Increased upkeep?)
We could have a building designed to help speed that process, or your caster could maintain a spell on that city to speed up the process. Or "even better"
make a "shaman" unit that has to go to a land square and make prayers/sacrifices/incantations so to bring the land to your kingdom/empire's side. This could introduce a Good vs Evil fight for land, and you could have spells that you could use to "attack" your opponents, by changing the land near their cities, making them pay more upkeep or whatever detrimental effect we can come up with.
Conclusion:
This type of idea would probably satisfy some of the issues with land/city rushing, as yeah... you could spread quickly, but you wont' be able to do so without economic or detrimental effects. So taking your time, and making sure you properly "convert" the land will prove beneficial. (Things should be balanced so that rushing will never be as good as someone who takes the time to nurse his cities. We have to make sure that it's not tipped on the other side either, where having 1 city is sufficient to win.
)
To deal with "city spamming", there could an be 'Empire' & 'Kingdom' "Terraforming/infusing/cleansing/corruption magical towers" that could be build outside your influence, and slowly converting the land around them AND spreading your influcence slowly. That way you could link the influence of your distant cities with a series of outpost. This would remove the need to put a city in every square inch so that the AI dosen't jump on it it would also help with mobs that attack your caravans in between cities. These towers could be required extra upkeep during conversion times, and dwindle down with time. So that it couldn't allow some one to spam them, as they would choke themselves with upkeep.
This could also add an interesting element to enemy conquest. Should you conquering a member of the opposite alignment (Kingdom <-> Empire) then extra time would be needed to convert the land back to barren, and back to your own terrain. This would make wars longer as one couldn't spread fast, for he'd end up with cities "costing him, money/mana/wtvr" or that city could be extremely unproductive. I think it would be really nice to see this good land vs bad land front, where you are trying to convert the world to your image.
Hell this could even be a new victory condition, (covert more than 75% to Fallen / Graslands) Since we are apparently trying to rebuild the world. 
This could also create an interesting dynamic, although you have good political relations with members of your allegiance (Empire / Kingdom), you would have an insentive on wanting to conquer their lands, as they already are 'Fallen / Grasslands'.
Before I just keep going i'll leave it at here for now, and see what the feedback sounds like. 
Keep on sharing your ideas people!
Thanks,
V