Has anybody every tried this?

[caius britannicus]

yeah , no sieged provinces can be given to other factions

and eaven when you give the pope a province your relations with him plummet to abysmal

Thats never happened to me. In my sicily campaign I gifted the entire mid-east to the pope. My standing with him sky rocketed (I even gifted it to him with the garrisons still in the cities in some cases). The nice part was that they established Jerusalem as their new capital and I was able to take rome from rebels that went against the pope (large distance no garrison). He asked for it back, but I couldn't give up my position in italy so I kept it. The drop wasn't significant so it worked out great.