Crap didn't know Krax had a spell that good! it was Krax who stole the city so that seems possible.
The bug for AI win was definitely conquer, had a cut scene pop up and all stating a conquer win - it was Krax who won so maybe the AI managed to cast the spell on all of my cities in one turn, and then when I re-loaded they decided not to? - I don't think I had difficulty that high, maybe one up on normal. (ill check later)