The Halfling quest has made me question whether Halflings are underpowered, or if they just make poor magic users, or if I just don't use optimal strategies with them since I hardly ever use them.
I think one of the big issues coming from alpha is that the larger number of conversion points available earlier in the dungeon greatly
favours permanent bonuses over the one-time bonus offered by halflings and gnomes. Secondly, we currently have lots of ways to stack and multiply attack and mana, but very few ways to improve hit points. In fact, the only reliable way to boost your HP currently is by playing as a dwarf... something mutually exclusive to playing halfling. This leaves very few combos available for someone trying to utilize lots of health potions.
As far as gods go, this should actually improve as more are introduced. Part of the problem right now is that deity list is pretty narrow, which affects quite a few classes. The recent Mystera change has pretty much left Warlords out in the cold as well; can't use Tikki or Dracul because he hates CYDSTEPP, can't use GG because he hates mana potions, can't use Mystera since she boosts physical resist, can't use Taurog since he'll lower your mana below 10.
I'd agree that as it stands currently, Priest is the only class that seems to work for halflings.
Also, Bleaty is just absurd when he spawns in Grimm's Grotto. He can take nearly as much punishment as Super Meat Man but hits around five times harder!
Bleaty seems balanced on the presumption that you're a Rogue with CYDSTEPP. He's an obscenely powerful boss as it stands currently and has no business spawning into a dungeon labelled "normal" difficulty.