I'm a bit iffy on the wording. Anyone think they can help me out?

There are people who are better at wording than I am, so I'll let them do that. What I couldn't help but notice, however, is that you could, instead of destroying the creature, put it on top of the library, then perform the action. One less mill, more consistent removal, and making Melvin happy is in the exchange. The down side? It feels like it should be blue, or white? of course, it couldn't be (blue can't permanently get rid of things, white can't mill). Sounds gold, I suppose. Mono-black is fine by me.

This wording looks pretty good, actually. I'd say "That creature's controller" rather than "Its controller", but otherwise it looks spot on. (Induce Paranoia suggests that you could also use a wording involving X, but I don't think it's necessary.)

JMG's suggestion is amusing, but rather nonstandard for a kill spell (the only think I can think of that's done that before is Spin into Myth, though it's also reminiscent of River's Grasp).

This spell looks so natural that I'm surprised there wasn't a Dimir spell in Ravnica that did precisely this, like Induce Paranoia or Psychic Drain. Which is a good sign :)

http://gatherer.wizards.com/Pages/Search/Default.aspx?text=+[%22creature.%20Its%22] suggests "Its controller" may be fine. (Check the apostrophe.)

I'm not positive about "equal to". http://gatherer.wizards.com/Pages/Search/Default.aspx?text=+[%22equal%20to%22]+[cards] sugegsts that it may need to be "a number of cards equal to" rather than "cards equal to", but I'm not sure.

But either way, yeah, the templating is fine, about as good as most "finished" cards on multiverse.

Edit: Never mind, http://gatherer.wizards.com/Pages/Search/Default.aspx?text=+[%22cards%20equal%20to%22] suggests "cards equal to" is fine.