The opening seems a little stiff, and the follow-up seems a little too loose, but about half-way through the episode, this story hits its stride.
I’m not in love with any of the characters, but I think the writers redeemed themselves right at the end of the episode. I am fairly impressed with some of the artistic choices – e.g. the artists are willing to include some ugly girls in their fantasy town, instead of making every girl a knockout.
It’s interesting to compare the “feel” of this fantasy to magitech fantasies. In a show like Hitsugi no Chaika, magic is very slick and reliable and technological – i.e. impersonal “magitech.” In Shingeki no Bahamut I get the sense that magic is not very controllable by ordinary mortals, and demigods who walk the earth are not easily bargained with. It’s a much more medieval sort of magic, with much more of a personal element.