Any religion that regularly involves rituals of ripping people's hearts from their living body and then being dropped into lava can go the way of the dodo bird imo.
It's been a good many years since I've watched TOD actually but I seem to remember that he was only concerned with destroying the thuggee cult. The villagers that revered the stones as being holy were regarded as simpletons but Indy actually helped them recover their holy stones. He was pretty knowledgeable and respectful of the people and their beliefs, I think.