I would suggest removing Babylon as a settlement and putting a new province where it is more needed. Like the description ingame reads, before the game starts the population was moved to Seleucia, it transformed from an important city to just a religious landmark. It could be represented on the map with a wonder showing the significance it had culturally, but no longer economically or militarily on the region.
Another thing i donīt get is why phalangites canīt be recruited in Seleucia, but in other places like Hyrkania, that donīt even start with a minor hellenistic polis, they can? I think if Seleucia was the capital then it should have been hellenised enough for phalangites being recruitable there, not as part of basilike patris of course, but with the colonist building.