I don't think they are OP, nor that Meridian refrains from using them. When he does, he almost always relies on "chaining tactics" to get it further than from the first soldier. I think the decently high TU cost as is on Timed grenades is fine. I has nerfed them down from the almost instant solution that they were in vanilla. As it is, because of the TU cost I use MUCH fewer grenades than I did with vanilla, but then again, my Options are MUCH more varied. Your instant grenade alternatives (black powders, etc) are very good and go a long way to making up for the grenade nerf. Even with their limited range they are often potent options.