Coding for versatility often is less efficient than hard-coding for a specific effect - but if you want moddability, you code for versatility.  And I suspect you hugely overrate how much dev/modder time it will cost to divorce the damage type "fire" from the standard secondary effect associated with normal fire while still leaving them linked together in every in-game appearance of normal fire.

I am strongly opposed to hardcoding anything into damage types other than the type itself.  Resistance and susceptibility codes would then reference the incoming damage type to see how effective (or not) the incoming spell or whatever should be.  Anything more hugely limits moddability, and that's not a good thing.  If I want a burning blood poison that inflicts fire damage, or a cold fire that spreads like fire but inflicts cold rather than fire damage, the game should not be hard coded to make that difficult.

Providing the option of whether or not SD=GO would merely exacerbate that problem. It would force the devs to code two variants of every AI, because the AI would differ vastly between one of those options and the next. It is not a cosmetic or surface change to the game, or a variation of parameters. It is a very fundamental on/off, which requires hugely different strategy. Additionally, if SD ≠ GO, then what happens when your Sovereign dies? Stardock would have to answer that question, then work it in, then factor that into one of the AIs...

I'm all for options, but not for fundamental aspects of the game that would require an immense amount of work from the devs. Other than this one issue I agree with the rest of your points (although I'd add that BoogieBac already said that he believes magical damage types have always been intended, implying that Frogboy's latest post was referring only to physical damage types).

On that topic:

While I agree that elemental damage types are needed, I don't agree with your formulation of them. Lighting damage has nothing to do with it being applied instantaneously or not. My lightning-enchanted sword isn't going to deal lighting any faster than my fire-enchanted sword; my target can still evade my sword and thus its lighting damage. Instantaneous damage from a lighting bold is a property of the spell itself, not of the damage. Likewise with the others, like rakenan said.

Damage types are basic things, that basically just modify the damage done to a target (and maybe the effectiveness of a unit in a given environment) jointly with the target's appropriate resistance values. All other aspects should be applied as effects. "Instantaneous" could apply to more spells and attacks than just lighting strikes (one example that comes to mind are mind-affecting spells). While "damage armor" might be a common theme among most fire spells, it should not be a requirement - and thus it cannot be fundamentally tied to damage type. As an effect, it would be applied to most fire spells, and could also be applied to other things (weapons, creatures, etc). The result is a more generic framework whereby the same content can be applied to a wider aspect of the game, reducing development/modding work and increasing control.

At this point, we're pretty obviously talking past each other.

The spells are interesting, at least potentially, already.  Adding more magical damage types only improves the situation by allowing for variable magical resistances - letting enemies be vulnerable to one particular kind of damage but not all others.  That's it.  They can already make a fire spell that melts armor or sets siege engines on fire if they want to.  The only difference adding a fire damage type is to prevent that spell from setting a lava catapult on fire or melting a fire giant's molten armor.  Your way would make it impossible, or at least more difficult than necessary, to code the really interesting spells that don't act like normal fire or normal lightning or whatever.

We're talking about a fantasy game here.  Not all fire should act like normal fire.  Not all poisons should act like normal poisons.  Not all lightning should act like normal lightning.  Magic warps the standard laws of reality, and a game engine that makes it hard to code that - like, by forcing all fire to act like normal fire - is poorly suited to a fantasy game that has magic.  The one thing all fire should have in common is that creatures that live in and thrive in fire should suffer less from it, and creatures that avoid and are particularly vulnerable to it should suffer more from it.

   I never said all fire spells should always causing burning/consume.   I said when the fire element is used it should cause the burning/consume secondary effect.  A fire spell and the fire element are two separate pieces.

As mentioned earlier a fire spell and the fire element are two separate pieces.  Fire Resistance is used for reducing/decreasing the effect and secondary effect of the fire element.  Naturally 100% fire resistance shouldn't help against a fire spell such as Solar Burst which can blind a single enemy.

  Fire spells are magic which use traits of fire such as a solar burst causing blinding is an effect of extreme brightness from a sun or moon in the sky.  The fire element is what you see when striking a match and often mixed with fire spells thus creating fireball, incinerate, explosion, etc., on the battlefield.

  I agree powerful creatures such as fire elementals should be immune to most fire attacks and items/weapons/armor should possibly be carrying one or more elements used in its damage(if any).  

  It seems useful as well as fun for the elemental damage types to include their secondary effects.  I'm not saying anytime fire spells are used, I'm saying only when the fire element is used... such as a fireball.  If a soldier/hero is wielding a sword which carries a constant flame surrounding the blade then it should have a chance to cause burning on the target unless the target has high restistance/immunity to fire.  Now a water elemental would not catch on fire only because it has a natural dousing effect, but it would definitely take more damage from a fire sword.

Agreed