[pushkins]

You have pretty well identified your own problem, the ground needs to slope away from the property as you know. You cannot fill the lower area against the house as it would bring the level far to high, you need the level to remain well under the siding.
The only solution to your problem here would to be to remove the top of the small rise.
You could dig down and install a French drain but this would be much more work and the result is you want to move the water away from the area and not have to deal with it once it is there.

There really is very little in the way of water proof paints that will work well when applied to the inside of a basement, the principle is that they seal off the water from entering the internal side of the basement wall or floor, but in reality what you are doing is allowing it to permeate through the brick or block and hit the painted barrier. Water will accumulate inside the cinder blocks and , as water will always do eventually, seep it's way in.

Sealers work best when applied on the exterior side thus stopping the water permeating the block in the first place.