Muh Dude I thought about adding in a modifier to the land grab, but then figured people would adapt their land/castle ratios in the beginning to not have such an impact on their loss if attacked. Not that that helps people stuck in their current situations, but at least they're only losing their land and not land + castle, so the new rule is still helping the land fat kingdoms a bit.
In the future, with this rule in place, people will probably start their second castle between 20-30 lands, and probably not explore more land until their 3rd castle is close - so as not to risk losing too much land.
We also don't want to nerf attacks too much. Chancifying castles is itself a big loss for attackers, if we cut land grabs as well then we run an extreme risk of creating a farm heavy environment.