I'm curious how this is going to knock on with other Pagan religions.
And what, if any, will be the reaction of Islam?
I've speculated more on the latter than the former. The nature of the persistence of paganism is basically conservative; I think if we look at the trend of world history there are deep reasons why as the general level of civilization and its integration on larger and deeper scales rises, the kinds of religious traditions we call "pagan" tend to weaken and vanish in the face of more centralized, single-cause religions--monotheism, but also more abstractly philosophical traditions like Buddhism or Taoism. I suppose we might look at India or Japan for counterexamples, but both of these places have tended to evolve their still robustly pagan beliefs to include or be dissolved, as it were, in a high philosophical perspective that basically agrees with the hard-line monotheists that ultimately the divine is One. So Japan has a heavy layer of Buddhism over the casual acceptance of the idea of lots of little spirits, and they don't make much of their traditional great gods because they see them as manifestations of a deeper spirit; the Hindu tradition too has developed a refined sort of pantheism too. In a sense if you have dozens, hundreds, or thousands of spirt-beings they sort of blur into one general divinity. Whereas when we think of classical pagan religions we have a relatively manageable pantheon of a dozen or so great gods who are very distinct from each other--but in reality, when these gods were deeply believed in, it was more a matter of different localities being more devoted to just a few of them, and the functions attributed to one in one place overlap those attributed to another in another place. Plus of course different clans of people, even ones closely related to other clans and interacting with them a lot, would each have their own focuses. So the potential for Hindu or Shintoist type blurring of thousands of them is already there. It is the actuality of more and more people in more and more complex civilizations with more division of labor hence more social detail interacting with more and more other such clusters of people on larger and larger scales that makes the philosophical mind step back and question, who are the gods really? Are they all real but some more powerful than others; are some of them fake? Are they all just expressions of something deeper and more profound? And so on. You get philosophers asking awkward questions in the light of ordinary people meeting others who look at things differently than they were raised to, and thus the quest for a "higher" religion, a challenge that the Christians, Muslims, Buddhists, Taoists and so on rose to in diverse ways that more or less address these questions.
To be sure there is also the politics of religion; it is very important in society and so the ruling classes take an interest in it and it is quite possible to argue that the forms of different religions are mainly shaped by the demands of these rulers--then one steps back and sees that the common masses of the ruled have something to say back to these rulers they can't get away with saying to their faces individually--religion becomes a deep forum of the class struggle; it has to offer something to those masses and the fact that successful religions do so helps explain which ones dominate. Because of the ethical content of religions its own leaders take a deep interest in social issues and become political figures of some power in their own right. The evolution of religions then has many deep connections to the evolution of human societies in general.
So keeping a strong "pagan" religion going in the face of such robust mass-society challengers as Christianity and Islam is a tough challenge which is why this TL is so interesting--how are they going to do it? Will they resist change and thus make the pagan sphere more and more isolated and backward, cut off from contact as the Christians surround them? Or will they enlist allies? Or will they instead develop Nordic paganism into something comparably as sophisticated as Christianity, and also something as prone to win converts?
Enlisting allies addresses your question I think; would the Nordics decide that say Slavic pagans in the eastern Baltic are better neighbors than the Christians, and by a combination of philosophical inspiration and offering them useful worldly power to ally with, inspire a parallel revival and development among the Slavs? Or will they simply see them as people to subjugate and assimilate or be subjugated and assimilated by? If a cordial alliance based on the fact that they are all non-Christians together facing a collective existential threat ensues, how will the different traditions see each other--will they tend to find and agree on equivalences between the Nordic and Slavic pantheons (very likely harking back, more or less accurately, to primordial versions of each which once long ago were one and the same, deep in the Indo-European past when Germans and Slavs shared the same common ancestors) and thus go down the same path the Classical Greeks and Romans did? Will this undermine the deep folk faith with lots of philosophical cold water, or will Errnge be able to invent a new Great Religion that somehow keeps the polytheism robust in the face of the tendency to merge all gods into One? Or will they instead become more and more uncomfortable with the differences between their traditions the more seriously they take their folk religions, thus splitting the Pagan sphere into bitter rivals?
I've spoken more about Islam before. I suppose it is possible that a number of emirs and perhaps even caliphs might decide that helping these northlander pagans against their Christian foes is in their political interest--but every time they do so, they'd be guiltily aware they are consorting with outright idolators against heretical and misguided Nazarenes who are nevertheless still People of the Book; in their foolish way, the Christians are after all followers of Allah too, even if they reject his greatest Prophet and believe absurd and offensive things about another one (Jesus). So I think there would always be some serious tension in their relations with the Nordics; they are glad they aren't Nazarenes but exasperated that they don't therefore embrace Islam as the true religion Allah has given to men to follow. Non-Muslim People of the Book are supposed to be an improvement over paganism, from a Muslim point of view, and consistently championing the latter over the former will always cast shadows of guilt and doubt. The Christians, especially the Roman Rite, will annoy them enough that they might well be able to convince themselves Allah has sent the Nordics to chastise and humble the Romans and therefore they can assist them--but the long-term interest of the Muslims in these alliances is that the Nordic peoples convert to Islam, and as long as the Pagan spirt is strong among the Nordics they will resent that, and the Muslims will resent their stubborn "folly."
I suppose that over the centuries, various Muslim sages will find virtues and inspirations for Muslims to consider among the heathens, and Nordic sages might find ways to profess common ground with the Muslims without giving in to the demand they profess there is one God only, and Mohammed is is greatest prophet, ways that perhaps even the Muslims can live with. But again this would be an exercise in creative religion-building and various developments along those lines OTL--the Sikhs, the Ba'hais, for instance--suggest that is a very rocky road to travel in either direction on.
Basically if the Pagans can make mutual peace with Muslims, why can't they do so as well with their immediate Christian neighbors? The clearest answer to that is it boils down to geopolitics, to the enemy of my enemy being something sort of like a friend--and insofar as any Pagan-Muslim accord is founded on that negative and worldly factor, it will be a sour note to both of them, however compelling the strategic motive is.
Certainly it would be easier for such a grand alliance to happen if the two parties are widely separated, so the pagans aren't directly contending with the Muslims over the same territory.
Suppose for instance the Nordics were to go a-Viking, and thus come into the Islamic world (as they did OTL) and there learn things that so enhance their seamanship (further even than OTL) so that they sail down the Atlantic coast of Africa, and there find in West Africa and southward another bunch of pagan peoples--ones whom the Muslims have been trying for some time to missionize and convert. But the Vikings find that they can instead relate better to the pagan Africans, the feeling is mutual and the Vikings wind up stimulating a pagan revival among the West Africans--now Islamic and Pagan proselytization are running into each other head-on!
I don't think that's a particularly likely scenario to be sure, unless Ernnge hits upon some kind of philosophical skeleton key that enables very different paganist traditions to inspire and strengthen each other without undermining the faith in their very different pantheons that keeps the pagans pagan and not merely the inventors of yet another universalizing religion to dissolve all the gods in.
I went on to say more stuff but it's really more in response to a canon post Ernnge made some time ago so I'm moving all that there.
