Arcane Monolith gives you an area in which only you can build a city. The strategy is that you put it down in the area you want because of valuable tile yields, resources and choke points, then no other faction can place a city/outpost there and you are safe to get it or block the AI from getting through an area altogether. The game is all about map control from the first season on because it is heavily resource-based, all the other mechanics become important later on if you established your territory.
You can get quite a lot of things early on that increase your mana income...
Realy, name those lots of things... at early game...
Attunement, Adepts, Meditation, Staff of Souls, Shards. That is more than you need to get lots of Mana early on, even if you don't change the map settings to dense shards.
Oh so in order to use AM with ease i have to spend 2 talent points for staff and attunement (2 mana per season = 25 seasons fo 1 AM). Ever tried to get a kill hit with 4 dmg staff ?
For meditation you first need essence, then you need sacrifice spot for enchantment (you can use soverigns call or food enchants you know for population and simply train pioneers)
Shards... well with normal set up you might get none of them to your first city. Its kind a luck thing. And first lvl of building yields 1 mana per season.
Adepts its 1 time bonus for 40 mana, not steady income. And its onother racial strength point plus to 2 points for AM itself.
Now consider hero/unit enchants, casting while in battle, city enchants cost also. You might get no shards to starting location and what then ? More than enough - i dont think so. In middle game - yes i do, on early stage - nope.
And if i need so many rely on getting shards, spending 3 points of racial strength, taking 2 talents to get mana so all this AM stuff could go id rather just take you know lucky, quick, master scouts and simply go with pioneers
To make pioneer takes less time than gather 50 mana especialy with some food management and some food buildings and city enchants, growth can get boosted easy as well.
Yeah AI cant build within AM area, but it can build next to it and flip it later. All what can AM, pioneer also can + city. All those advantages you mentined about axpansion can be taken by pioneer OR AM, thats why i think AM is fine, it does not give any exceptional options only part of pioneers.