I was thinking more along the lines of an actual game, but if someone can think of a way to make it into a functioning (and enjoyable) forum game, be my guest.
The Rogue differs from the Priest and the Demonologist because the latter two classes need to build up a strong force, and attack their enemies indirectly by commanding that force (although the Demonologist can imbue himself with demonic powers, it's still rather difficult to take on a large crowd all by his lonesome, unless he decides to go all-out and take on some very revealing buffs, in which case he would be fighting an even bigger crowd by himself, since the whole city would be able to see him for what he was). The Rogue gains power through self-improvement, and deals with his foes in a far more personal fashion than the others. It's for those players who follow the "if you want a job done right, you have to do it yourself" philosophy. Plus, it gives you greater versatility due to only needing to account for one person, the one you control directly.
As for lack of players, that is indeed one of the greater problems. However, one thing is to make certain there is always one extra force in a conflict... Namely, that of the city itself.
The location should play more of a role than a simple staging ground, it should be a force unto itself. A Rogue-against-Rogue match could be fought out through a sleuth-style investigation, trying to use unusual purchases and behaviour recorded by the civilians in order to find out who his enemy is. Then, once discovered, it's just a matter of placing a blade in that sweet spot.
That's the thing, unless you're exceptionally high-profile (such as a big fancy preacher, a hideously warped Demonologist or a black-clad "utility" Rogue), you shouldn't easily be able to tell the players apart from the crowd. This is the greatest stealth afforded to players, not the medieval equivalent of a cloaking device seen in other games.
The city should be a living, breathing entity, providing resistance (or aid) to any player interacting with it. Overeager preachers may encounter resistance either from the local church, or from a lord concerned by the zealous nature of the few fanatics who follow you (once you gain a following throughout a greater percentage of the city, it's perfectly fine to amp up the fervor by a few notches). Demonologists and Rogues have to keep their dealings in secret, lest the city watch set up patrols to keep an eye out for suspicious happenings (or, if you're really unlucky, your face).
A Rogue vs. Rogue encounter could be as simple as balancing between your fight against the city (in order to gain strength through contacts and equipment), and the hunt for your rival.
Speaking of which, that's another thing that could make for a useful gameplay facet. Paying someone (or simply telling them to, if you've got enough authority over them) to keep an eye out for a character you've previously identified. You won't receive the sort of telepathic warning you'd get from a standard RTS, but they'd make sure to let you know should you ask (or if you feel it's urgent enough that you tell them to send a runner to you, but that has its own risks).
But I do realize the problems involved with a two-sided stealth-based conflict. Two Rogues chasing each others' tails could quickly become tedious, and I don't know if it's possible to make an "alive" enough city to alleviate that.
This, however;
What if it became Priest(s) vs. Priest(s)? Would it turn the city into two halves of fanatics trying to duke it out for supremacy?
I see no problem with.
As for converting the various buildings, I'd rather it be more along the lines of just using the building for your own purposes. It would of course be quite possible to rearrange some furniture and turn a modest home or storehouse into a workable chapel, but it would be much easier (and prettier) to simply take over the church that's already there and provide it to your own followers.
The Demonologist would probably have the strongest effect on his immediate working environment, drawing out profane circles and diagrams on the floor and warding runes on the walls and doors, as well as setting up candles wherever necessary. Sewers would probably work quite nicely, since very few people would bring themselves to go down there. However, you do have to deal with the other ruffians who are down there, as well as the rat-catchers. Plus, if you knew you were fighting a Demonologist, wouldn't that be the first place you'd look?
And Demonologists, like I said, are indeed capable of gaining followers (it's quite handy having someone you can send out to get basic supplies while you busy yourself with other matters). You just have to talk to the right people.
I'd rather the Priest remained non-magical, relying entirely on the faith and loyalty of his flock for power and protection. Not only is this a much-underused aspect of priestly characters in videogames, it also appeals to my cynical sense of humor.
It could work, of course. But if he
is allowed certain powers, they should only be awarded through the size and fervor of his congregation. You shouldn't be able to gain anything that you can't somehow lose.
Rogues aren't strictly necessary, but I don't know of any other third party that would fit it quite as well.
EDIT: In regards to the Captain of the Guard, that would most likely be controlled by the city. You can bribe, coerce or convince the Cap'n to see things your way, but I don't think you should be able to control him directly. The Captain is wholly a part of the city, and should be treated as such. The player characters should be things that are less directly associated with the city.
And anyways, the high-profile army leader is already covered by the Priest (at least the late-game Priest, once he's influential enough to control the government and, by proxy, the guard). The similarities wouldn't justify an extra class. Perhaps an alternative, but not an additive.