Under Divine Advancement on page 273 ARPG it states that a divine caster of Neroth may advance a single Arcanum skill, Diety's Favored Skill, and Knowledge Religion. The issue is that Neroth's favored skill is Knowledge Religion. So, do Nerothians advance this knowledge at twice everyone else's rate? Do they substitute another skill? Or do they lose the ability to advance three class skills in one tier?

As written, you would receive two ranks in Knowledge (Religion) each time you took that advancement. I'm not aware of anything in the rules which would prohibit it. You are only restricted from adding multiple ranks to a skill in cases where you are selectively placing those skill points (i.e. character creation, +1 to 3+pLo skills, etc).

Yet another problem with the Divine skill advancement options...

As a Beltinian healer I get Arcanum (Cants), Knowledge (Religion) and Heal. Personally I'm cool with that as it fits my character concept. But I agree the Nerothians my be getting hosed. On the other hand if Knowledge (Religion) works with undead like it does in 3.5/Pathfinder then it makes sense.