As the Razed city/salted earth feature isn't universally liked, perhaps a better solution would be to have the afflicted land increased by +1, +1 whenever a pioneer is ordered to 'Cultivate' an area (essentially improving the land). Like outposts he dissapears forever. Every further Pioneer increases it by +1, +1 but not above it's original value. This would make losing cities a set-back rather than strategically fatal.
In Civ IV: Colonization it is possible to engage in a cold war with rival factions by buying Privateer units that fly a neutral flag and let you pray on rivals without it being a cassus belli. This is often a welcome alternative to all-out war. My suggestion is having an ability (possibly faction-specific) to hire neutral monsters as 'Free companies (for a money and influence cost)- uncontrollable but actively hostile to other factions other than your own. Factions are not idiots and give you a -1.0 relationship every time you hire one (accumulative to avoid spam but disappears after a while). Free Companies should be Medium in strength to make it worthwhile.
Just some thoughts.