Evil,
You misunderstand me. Hidden Legend was suggesting that bishops and popes should be allowed to marry and have children (as it would be interesting to see them try to establish hereditary lands). I was explaining the distinction between ecclesiastical rulers and ecclesiastical dynasties, and why I thought there was too little payoff in the engine simulating this properly. I think the thing with the Pope is an obvious bug and should be fixed, and wasn't suggesting the engine handles inheritance among bishops improperly.
As for hereditary sees, there's no question. It was one of the principal grievances of the Reformation. But within this time period, direct inheritance through one's own sons was (as far as I know) virtually non-existent. One pope in the dark ages, as I recall, succeeded his father, but he was born before his father took the holy orders.
EDIT: Also, it sounds as though the legitimate descendants of married bishops and even the pope can become pretenders to the sees. If that's the case, it should certainly be fixed.