skigglez no, not attacking. I have gotten attacked lots, lost 4-5 castles, bounced a bunch of attacks. I know it's not the same as actively attacking though. If everyone is investing into magic, then everyone's economies and militaries should shrink together... Or, people can stick to pure military and risk it. Even just 0.5 schools and something like 10 wiz/land should be basically standard for everyone I think.
Yes that's exactly what I do about the lost economy, during the day I use my wiz, and that saves me the cost of buying MP - that alone is saving me around 400k gp per day. Then my wiz get to be full power at night while I'm sleeping - more protection while I'm unable to respond to threats.
