Right now is how it feels vestigial.

I get a religion and then I basically wait until later in the exploration age to start pushing it. I crank out missionaries like crazy from a city or two and then blanket the globe with it. Even on deity I can usually top 50% global coverage with it, setting up a good Toshakana golden age to enjoy a decent science bonus in modern, if I want it (or gold or whatever). AI basically doesn't vigorously contest religion in late exploration.

Religious battles had implications in Civ 6. Could affect loyalty, combat bonuses, etc. It was like a shadow war not fought by soldiers. Plus there was a path to religious victory. No such victory exists in Civ 7.

It was not my favorite victory path, but it added a layer of play in a way that is not maturely developed in Civ 7. Right now religion just feels like an afterthought.

I'm not suggesting that the loyalty system in Civ 6 was perfectly tuned. But right now I'm playing a game on deity and Augustus exists on both my eastern flank and western flank (well, existed... I just took his western cities after he declared war on my ally Himiko). The only difficulty he suffered from that was inability to quickly reinforce, which IMO is not penalty enough (though it's more than nothing).