I'm going to hold off on some of my observations until after I give 1.6 a good spin, but off of the of my head...
Diplomacy - Needs much love. A good example of what I would regard as 'interesting' diplomacy is Alpha Centauri. There, you had some interesting civilization focus options (planned, green, police state, etc.) that you mixed and matched, and changed up every so often, to tweak your civilization bonuses along the lines of your goal. However, those very choices affected how other factions reacted to you, and would make/break alliances partially based on you pursuing 'crazy civilization paths' from their perspective. I haven't tried the latest iterations of Civ (gave up after Civ 4, actually gave that game away 'cuz it diddn't do it foe me), but Alpha Centauri really seemed to hit a sweet spot here. Sure, improvements are always possible, and it wasn't perfect, but it WAS compelling.
I'd love to see, say, Pariden, favoring one Kingdom over another because of similar outlooks, but others not so much. Also, it'd be cool if we had those 'culture path sub-options' to play with, that could tie into diplomacy in a major way. So that say Tarth isn't mad at Magnar because they are Empire (that's a good start), but because Magnar has been gutting the forests in Elemental, which they love.
Lack of consequences for your actions:
An Elemental equivalent of Civ's pollution mechanic could be interesting. Essentially, the world is trying to rebuild itself, but too much 'industrialization', deforestation, or gutting the local mana flows sets you back, and perhaps triggers 'mana quakes', as the magical energies are not yet back in balance. Currently, you just build cities up, with some minor choices which feel not all that important to me (note the spreadsheet comment someone made above, the bonuses often come down to math).
To elaborate on this, other choices should have consequences as well as rewards to consider. GalCiv 2 sort of did this with their 'Good/Neutral/Evil' mechanic, but unfortunately once your choose your 'alignment' this goes away. It would have been cool if those decisions played out into the late game. Unfortunately Elemental doesn't (currently) have small villages to incorporate into your empire, but if it did, this would be a great place to bring out such an aspect.
I.E. 'the village has a powerful magical shrine that protects it from mana storms. Such a shrine could add greatly to your power. Do you
A) dismantle the shrine and move it to your throne room (- to production in this village),
B)attempt to tap into it's power while leaving it in place (random chance of mana storms increased in this area) or
C)leave it alone (loyalty/recruiting bonus from villagers).
Random events could have multiple choices as well, with each choice having some dramatic impact on the rest of the game (good choice makes you more popular amongst the 'kingdom' type citizens, but more evil monsters target you. Bad choice sacrifices population in favor of some game effect, with 'good monsters' taking more notice/umbrage of your efforts.
Elemental has the ability to have more 'resource counters', so 'alignment/action counters' can be fairly easily implemented. So, with some love and a LOT of thought on the next design, a lot of this stuff can be worked out.
The one thing that I've observed lately is that Elemental always feels like it was rushed into production too quickly, and while 2015 seems like a long ways away, I really think it is time to take a 20,000 foot view look at the game, and some significant time spent on each new aspect individually. E:WOM is a perfect example of great concepts that fell flat in execution, and subsequent retreat from those ideas because of cost/benefit analyses and such to figure out if they were 'worth fixing'. I won't harp on many of these (feels too much like beating the dead horse), which ties into some of the comments above...
The above image is a perfect example of how Elemental could still look terrain wise. The current world feels too flat to me, and if the terrain art for E:LH was applied to this (some coding work, I know), I think that the Elemental world could be a little more compelling visually. Yes, the coloring of the world in the screenshot above does look bland, but at least it isn't flat. If I could have the 'ruggedness' of E:WOM back with a lot of new interesting terrain, and the 'improved' E:LH artwork, improved on yet further of course,, well then it would be screenshot worthy, just for the breathtaking views. Even the above vista does look somewhat breathtaking when you take it all in, even with 'older' artwork...
Retreat from multiple tech trees. at least E:WOM had Kindgom and Empire tech trees, and the code in Elemental can (still) allow each empire to have it's own unique tech tree. Modders have been too focused on other stuff to attempt this (a handful did back in the E:WOM days), but spending some time on unique tech trees for each faction could help flesh each of them out considerably.
Lack of unit differentiation. The faction bonuses we have now are a good start, but it'd be cool to see each faction having unique units that only it can build. Warlords III manages to give each of it's many factions unique unit mixes, and Elemental just cries out for it. Wargs vs Horses is a minor way to do this, there is potential for so much more. Sure, summoned creatures mix things up a bit, but that's a Sov thing, not a faction thing.
The various paths to victory seem bland to me. Really it boils down to Conquer or Spell of Making. One modder has introduced a City Victory, which is interesting (I like the idea of the 'Ultimate' Civilization as a victory condition), but my games generally fall along the lines of Spell Of Making unless I manage to gut all of the AI factions first. No real curve balls here...
The 'hero joining your service' mechanic has always bothered me. I like the 'acquiring fame to attract heroes' idea, but I think you should have more options here. Mainly, not be limited to just two heroes, but from a pool of heroes, perhaps with associated quests that tie in to each hero to 'earn' their loyalty. Maybe a mix of how heroes USED to be handled and the current form (i.e. certain locations on the map can be visited to recruit new heroes, if you have enough fame points to 'spend' to attract said heroes).
So to summarize, Diplomacy is weak, lack of important 'moral' game choices with associated consequences, non-differentiated tech trees, lack of unique and interesting faction units, and the current 'Flat/Tabletop' feel of the Elemental World are things that detract from my Elemental experience.
Some other things I dislike are lack of unit formations, no city walls siege mechanic, late game weapons are too OTT, too few 'classes/paths' to choose from, and the map is too small/cities too close together/units move too slow.
There are a lot of things I like about the game as well, which is why I still tinker with it after all these years. But I REALLY think that (other than DLC), it's time to take a big step back, and look at some of the overarching components of the design. E:LH has done well, but I still see a LOT of untapped potential...