Honestly the problems with rationalizing the tech system bother me a lot less than the problems with it in terms of implementation.

The lack of balance between the trees and specific techs is just glaring. I can accept some being 'better' than others, but as it is now some are just essential and many are totally useless (and a few are arguably actually undesirable!).

I have to say, this is an interesting discussion. Here are my thoughts after playing a couple games playing Kingdom, with the specific goal of uncovering everything in the tech tree.

Civ tree is the most traditional--research a tech to unlock new buildings, and new tech paths. Building specialization is good at first, but once you have the basic level production building for each resource, buildings tend to be little more than "boost this production value 25%." It would be nice if some of the buildings affected more than one resource (like many did in Civ 4). As it is, the buildings are just an extra step in between the "research x, get 10% bonus to y resource", while the refined techs give the same 10% bonus without the need to build anything. Kinda cool at first but a little bland when you get up to higher techs--it starts to feel like the Space Empires V tree, where you research the same thing over and over with incremental benefits at each stage. Verdict: ok, but could use variety

Warfare tree is also fairly traditional--research tech to unlock new tactics (squads, etc.), city defenses, and weaponry. I like the idea of squads and parties for your soldiers, but I agree that those training upgrades seem to be handled oddly. I also think that having separate branches for offense and defense, while allowing a more customized approach to warfare, would also break the game completely in its current state. The fact that offense is far and away more useful than defense in nearly every battle (certainly when facing other kingdoms/empires) an offense-only branch would guarantee that defense was never researched.  A simultaneous combat mechanic like in Heroes of Might and Magic IV would go a long way to making defense more useful, but the implemented quick fix seems to be just putting them in the same branch and require you to acquire both defense and offense to progress. So while I don't like the weapons branch much, I understand the reason for it being done this way. Verdict: should have much more interaction with the Civ tech tree; there should be cross-dependencies regarding building specialization (forges, smelters, etc.) and weaponry (plate mail, swords). Similarly, magic swords and shields should require research in both Weapon and Magic trees.

Magic tree is a little stale, as mentioned before. You can unlock a few more spells to research, but overall, the arcane spell research steals most of its thunder. Expansion to allow you to imbue buildings with magical bonuses to production or build a magical version of a wonder ala Civ IV would be nice. As it is, researching 6 new types of rings and refined arcana while trying to get the Master Spellbook has not brought any new excitment to the game, just a burning desire for it to be over with. Verdict: really needs expanding to be fun.

Adventure tree seems to be love it or hate it if you follow this thread. I personally like it--I think it fits well with the backstory and I think the alternate implementation of all the notable locations on the map but unusable seems like it would be very annoying. I thought this was an innovative way of putting quests and adventuring discoveries into the game, but I think it would be more true to form if it was advanced by something other than research--perhaps a rumours mechanic tied to inns and pubs that would bring you word of heroes and quests from around the world. Verdict: ambitious design and fun results, but needs to be affected by more than straight research.

Diplomacy tree is has some absolutely necessary techs and then dwindles into oblivion. I don't spend any time here after getting alliances (which I got lucky with and got as soon as possible--Dip level 6, I think) and then I'm done. I haven't found diplomacy useful, and my giant armies keep the other nations cowed and looking to pay me handsomely for non-agression pacts, my economy has me earning back my costs for trade and tech treaties in a few turns, and overall the rest of the diplomacy tree looks pretty useless. Maybe moving heroes from the Adventure tree to the Diplomacy tree would be better. Verdict: needs more options--either more diplomatic options or new civics, Civ IV style, but this tree really needs to be expanded to be worth anything.

I welcome further discussion.

Well that is the plan. Right now the game would just be harder to balance and complete if they added more techs and weapons. The future will likely bring such offerings.

• We're debating opinions, so if you can flag me as a "troll" for not agreeing with you, I have just as much right to flag you as a "fanboy". I'm not a troll, I look forward to enjoy an improved version of the game. 
• The issue is not so "settled" as you paint it. Some posters do agree with me, and similar debates have occurred in other forums
• There's even a mention of the issue in the MasterList!
• The explanations proposed here are fine, but they have to be stretched really thin to cover everything. Why do I "uncover", conveniently, only stuff of the proper level (heroes and lairs)? Wouldn't I hear of more legendary heroes, first, for instance?
• When a mechanic TRULY works, nobody complains. Nobody argues against heroes in Master of Magic showing up more frequently as your "fame" increases. Simple and elegant.
• These issues weren't even my main concern. If you read my original post again, you'll see that my biggest concern is with the lack of interdependencies. See what I mean with a quick glance at Alpha Centauri's tech tree here.

Of course I would NEVER suggest that Elemental should have SUCH a level of complexity. But right now, we're at the other end of the spectrum: absolute linearity, no interaction between the diverse fields of knowledge. If you mean to say that I've bought the wrong game, well it may be. I hope not, but I can't rule the possibility out. Still I think the evolution of knowledge can be represented in a more meaningful manner, as many games of the past have proven. If such an improvement could come even with a paid expansion, I'd be happy to pay its full price to get it.  

Because you have to find the great ruin of Ib to secure and translate the mural giving you the location of the Vaults of Lollth? Funnily enough you do actually know of some legendary heroes. That's what the Morrigan's Notes tech and similar are. The game never actually tells you who these people are, or indeed give you any kind of background information whatsoever, which is probably the real problem.

Its definitely low on the list (below Distinct Civilizations, Fun Battles, Properly Scaling Heroes)

Honestly, I think we could solve a lot of this with Distinct Civilizations.

For instance, say Altar has more heroes, better heroes ... something. Something that makes their heroes stronger and more badass. Yet maybe their Red-Shirt military is little more than a Shoddy militia, and therefore their normal army is far less durable.

Then, one Kingdom could focus on making  the best weapons/armor for their Red-shirt army. Heck, maybe even that kingdom has the best elites.

Then, one Empire has the most numerous squads. Like, Perhaps their squad sizes are 50% larger than everyone elses. And yet cost the same MAINTENANCE as if it were the previous number (see 33% discount). Maybe that empire even has +1 population growth (or even double pop growth) for all Towns/Cities below 200 pop

Maybe one empire has "better weapons" (and armor?) in their tech tree, but they all cost at least 1 crystal (or so). But ... their non-crystal weapons are pretty shoddy-weak .. so without magical crystals, their military power is severely limited.

Perhaps one empire has each city start with a Barracks-type building, and has several military techs (early-mid game) which reduce troop training time and maintenance, with a Refined Army Maintenance tech which keeps Reducing their military costs.

Perhaps one empire has really cheap equipment, with some even replacing a metal requirement for Materials. The downside, of course, is that these weapons and armor are less effective. Perhaps either their population grows faster (OR) their soldiers are sturdier/more HP.

Maybe one Kingdom has enough advanced trading techs to allow 4 caravans per city (early, medium, late), some in the Diplomacy section and some in the Civilization Section. Then perhaps a "Refined Trading" at the end of the Civ tree. Perhaps this nation is better at making gold and making negotiations.

Maybe one Kingdom is better at farming, and gets +1 food from each food resource naturally. Perhaps it gets 2 more green techs (to increase food production) before Refined Farming. Probably at mid-tree. Perhaps each of their trade routes bring in +1 food (until the caravan is destroyed). Perhaps they can also use Sea-based Caravans, which might bring in 2 food if connected to a food using City. (otherwise 1 food).

Maybe one kingdom is a gossip monger, and gets early access to certain heroes and special locations.

Maybe one Kingdom has a mid-late magic tech which allows them to change the type of a Shard in friendly territory.

I'm going to have to say I completely disagree with the OP on his primary point.  I think the tech tree is the game's charm.  It is in no way trying to be Civilization or Alpha Centauri or, hell even GalCiv II.  I love how which field you choose to go down means you get a completely different game with different gameplay features accessible to you each time.

I don't think the balancing is very good at this stage, but the general spirit behind it is really imaginative and fresh, IMHO.  I just couldn't disagree with the OP more.  And I love the other games that he mentions -- I just really like this game too.  It's different.  So the answer to the posed question is: maybe there are some balancing issues, but otherwise nothing went wrong with technologies!  They're really cool.