The most powerful spell is in my opinion the Phantom Spell. Especially useful when doing a no-loss game. It can be used in a lot of ways. I think the game has a pre-Phantom and a post-Phantom phase. The game, especially on impossible, is very hard pre-Phantom and gets to ok and even easy post-Phantom. This is how important I consider the Phantom spell to be.
I would like to include Death Star when playing as a mage. Especially useful when fighting the dragons in their home land. They are nicely lined up at the beginning of the match, so a single Death Star can target all but one of the dragon stacks. With an Int of 50+ each stacks takes 10k or more in damage - doing astral damage it works wonder on black dragons as well
. After a single Death Star spell, there is only a few remaining dragon stacks left...
Fear works on melee units even if you have units yourself of the same level. If you can surround your low level stack (for instance your level 3 Inquisitors) so that the melee unit can only get to your higher level stacks it will do nothing. I have tested this in KBTL but I guess it is the same in KBAP. I just tried it in KBAP, and it works there as well.
And I agree to what has already been mentioned: Fear, Target, Time Back and Stoneskin are all very powerful spells.