... at least for around levels 8 to 12.

Wyvern's Peak! (C3)

The place is a few steps south of Sorpigal so you can save the game after every run (why bother risking my neck in a dungeon with potentially dangerous encounters with no way to escape)
The enemies (tons of wyverns + one hydra) are all very easy; they only use physical attacks, no spells. You get 1666 exp to 3000 exp per battle, and as a nice bonus while grinding I got TONS of nice items in a relatively short time:

Belt of power (+5 might!!)
Flamberge +2
Great Axe +2
TWO Halberds +2
cold shield
cold glaive
boots of speed
defense ring

Why did I even bother adventuring in dungeons all those times and risk getting stoned/eradicated!

There are definitely reasons to go into the dungeons, as many contain unique things you can't find anywhere else. But you're right, the overworld is best for grinding.