HAR!!!! (your typo is my victory!!!

)
On track, I
do understand the rules and the rules as they are do not serve to undermine my point. I understand there are nifty spells that a well prepared mage could use to stymie detection spells.
And I understand that 'in the thick' there could be all kinds of things going on that could cause 'static interference' (if you will).
However, in a PW,
especially a more social PW like... oh, maybe ALFA

... the time for casting detect evil isn't going to be in the middle of a dungeon, so much as it's in the tavern or around the town square.
Generally, you don't have spells of evil going off all over the place. You have a bunch of people standing around and casting detect evil, especially as a spell-like ability as a Paladin, just isn't a difficult thing to do, unnoticed.
Having to wait until you're a 3d or 4th level character to even
have a chance of foiling a detect evil, which is available to the Paladin at level 1, that seems a bit unbalanced (to me). Your implication is that it should be relatively easy to find divination blocking magic seems well enough on the surface, and maybe things are different in the NWN2 servers... but from my perspective, "ZOMG, so cheap, it's just the cost of two CLW potions" wasn't a realistic viewpoint for
most low level PCs in ALFA.
As for not being able to tell the difference between a 'sadistic guard' and a 'serial killer', I do agree (detecting evil successfully does not necessarily solve all your problems), however, my point is based around my perceived unbalance of the ability in a PW environment (understand Mayhem was responding to a direct question and not embroiling himself in my argument, but I thought I'd clarify). It's not about misleading PCs via red herring NPCs or oversaturation. It's about a player's
complete inability to create a neutral evil PC who could ingratiate himself into the 'Company of the White Platypus' for whatever fun and RP inducing purpose he might have thought up, simply because the Company of the White Platypus has a level 1 Paladin in their group who
will (not might or can, but
will) be able to determine the alignment of the character and disable any chance of success.
Of course, that the ability is unbalanced and overpowered is just my opinion based on 1. the RP and plot possibilities that the ability,
as is, shuts down and 2. my assumption that 3.5 was balanced for single party play (a DM and the handful of players he's running), not dynamic PW play (with several groups of PCs and multiple DMs, coexisting in the same environment, all with different and sometimes conflicting agendas). It certainly isn't any sort of factual statement or proof of any realities.
For me, the ability would not be so ridiculous if it offered a saving throw (a simple will save) or if it only detected
actively evil creatures.