I have created a new Magic Damage Party (MDP), having learned lessons from the previous session. I will focus my casters on their magic realms which matter the most, while also allowing some physical skills to be developed (Close Combat, Ranged Combat, Throwing and Sling, Mace and Flail, Staff and Wand). My Bard and Gadgeteer will hold the physical line, having invested in Strength and Dexterity, and Music and Engineering, respectively.
This is because the perfectionist me, can't properly develop a Bishop, as saving too many spell picks inevitably results in a useless character. I will have much more fun with a party who isn't afraid to develop ASAP.

Level 1:
Priest: Heal Wounds, Make Wounds
Alchemist: Heal Wounds, Acid Splash
Psionic: Heal Wounds, Mind Stab
Mage: Energy Blast, Frost

You don't *have* to save spell picks with a Bishop. You might not get all of the 6th and 7th level spells, but:
* Not all of those spells are useful, particularly at 6th level. Even 7th level has some redundancy (you don't need both Concussion and Cerebral Hemorrhage, and Falling Stars is weaker than Earthquake).
* A Bishop who doesn't save spell picks prior to level 14 will still learn enough good spells to be useful.
* You don't need all 4 schools to have enough spells to be useful. Early on, in fact, it's best to develop just 2 or even 1 school, and then pick up the others (if desired).

Also, if you ignore spellcasting and XP requirements, the Bishop actually compares quite favorably to other casters:
* Priest: The least favorable comparison. Priest gets more HP and (mostly) the same equipment as the Bishop, but note that the advantage isn't as big as you would think, given that even a Bishop can use maces (including Diamond Eyes and The Mauler) and shields (including the Thieves' Buckler that boosts Agility and the Lithe Buckler that provides a small amount of Stealth). Pray for a Miracle is something players tend not to use much, and Dispel Undead is available to the Bishop as well.
* Alchemist: Alchemist gets more HP, but worse equipment (no maces, in particular). The ability to brew potions while resting is quite nice, though it seems that a lot of real time has to pass between potions, and potions are readily available after the early part of the game, especially since anyone with Alchemy can mix them. Also, while a minor thing, note that Bishops can cast Alchemist spells while silenced, even though it isn't listed as a class ability. (Spells cast while silenced always train Alchemy, and non-Alchemist spells still can't be cast.)
* Psionic: Psionic gets mental status immunity, which is either very useful or utterly useless depending on what you're fighting. Aside from that, Psionics get worse HP and worse equipment (no shields, for example).
* Mage: Mage is actually a terrible class. Worst HP, terrible equipment (worse than Bishop), and the only advantage here is a measly 5% bonus to all resistances.

I will give it another go. A lot of resting will be needed in between battles for the quick SP refill. Thankfully, I have a Bard to speed that up.

Level 2:
Priest: Stamina (learned from spellbook), Paralyze
Alchemist: Stamina
Psionic: Paralyze
Mage: Sleep

resting between battles makes for more battles against harder mobs so be careful doing that doesn't bite you

also dealing damage is great but being able to take hit without die \ disabled is also important... a Bishop knocked out does zero damage

it's your game, so good luck ;)

I'm only taking catnaps just to top off SPs, not full rests. Also, having a Bard doubles the rate of SP regeneration. This doesn't result in too many enemy spawns.
I'm also camping near the two cells that are safe places to rest.

Level 3:
Priest: Guardian Angel
Alchemist: Cure Lesser Condition
Psionic: Identify Item
Mage: Missile Shield

Level 4:
Priest: Light (learned from spellbook), Web
Alchemist: Itching Skin
Psionic: Insanity
Mage: Magic Missiles
Cleared half of the Lower Monastery, all the set monsters and treasures. Ready to face King Crab.

Level 5:
Priest: Armorplate
Alchemist: Noxious Fumes
Psionic: Shrill Sound
Mage: Freeze Flesh
Beat King Crab. Will meet with Burz for equipment before facing Gregor.

Level 6:
Priest: Rest All
Alchemist: Whipping Rocks
Psionic: Psionic Fire
Mage: Fireball
Swam the waterfall. A little more training (now I have a level advantage over Gregor).

By the time I reach level 6, it's easy enough for me to buy a spellbook of Rest All from Lord Braffit.

(Incidentally, I'm replaying Saviors of Sapphire Wings right now, and it's interesting to see how the balance of spellcasting is completely different in that game; My two Healers can quickly kill bosses with attack magic, which is something that would be unheard of in Wizardry 8.)

No kidding. If you are going to run a MDP, level seems to be everything. Grinding is even more beneficial than for a normal party.

Level 7:
Priest: Cure Poison
Alchemist: Cure Paralysis
Psionic: Silence
Mage: Detect Secrets
Gregor was defeated somewhat easily, using status debuffs combined with damage spells and physical damage. The Lower Monastery is cleared out, except for a few items in the waterfall which I will detect, and of course, the Wheel Key/Cierdan's Tomb. I will set a portal there eventually so I can portal in and out, once I reach Arnika.

Why'd you take Cure Poison?
* The spellbook can be bought easily enough from Lord Braffit.
* Curing poison is usually not necessary, as it goes away with time and the effect isn't anything you can't reverse with Heal Wounds, a spell you're going to want anyway.
* Even if you do feel the need to cure poison before it runs its course, Cure Poison potions are one of the most common items in the game; even if you don't learn the spell, you'll probably find more of the potion than you'll ever need.