Hmm.. I think that things would work best if the battle ended once the entire army was killed, with a deathcam type option for just viewing but not commanding if dead. If it ended when the commander died, then battles could end unfairly with a random shot killing the commander and ending the battle. Without the commander, however, troops are in disorder because they receive no new orders and there is a huge disadvantage (realistically, if a commander is no longer able to command, the troops are more disorganized/morale goes down).
Also, I think that there might be an issue of how to operate servers using this mod. If there are only two commanders in the match, then the server size would only be something like 2 people, and it would be costly to maintain enough dedicated servers for all these matches. One possible solution would be that if you wanted to play a match, you would host a server for this mod and those seeking matches could look on the server list to join. Another solution could involve making each match have several commanders on each team, each managing different troops. To make this possible you would have to change the bot code so that more players in the server wouldn't dramatically reduce the bot number and find a way to assign commanders effectively.