Personally, I agree that the fountain is not a good deal - you have to use 1.5 population for every merc point. So you end up with fewer overall troops.
However - there are some possible reasons for having a fountain. AND, the rules for owning a fountain recently changed. Now, if you own more than one fountain, you get a 10% reduction in population cost for each additional fountain.
I can see 2 reasons I consider valid for buying fountains. One - you want more than one location to buy obelisk mercenaries. You can do that from a level one fountain, and it only costs 150 population. Two - you don't have any vassals and you need to beef up your mercenary points.
Now, also note this. With the new adjustment rules, when you have 6 fountains, your population cost is down to 1:1 - break-even with population! That makes fountains a bit more interesting.
But, if you are in an order, fountains do not add to the order's shared mercenary points (if somebody proves me wrong, i would love to hear it) - which to me is a big disadvantage. And, fountains do not contribute to the number of mercenaries you can buy in the obelisk of fountain.
So, mostly not a good value in my thinking, but with possibilities in certain circumstances.
(20farms X 360)
from the city
and can never be both? 
