OK, I've fixed several of the bugs, including some fairly silly ones with the tactical AI, but I've also had time to add some new features:
1. An option of "heroic health". This gives you and all other troops the ability to gradually recover hitpoints. It effects everybody equally, but it obviously favors the player a bit, in terms of single-handily taking on the enemy, so there will be a minor penalty for having it on, and it will be off by default. But it makes stuff a wee bit more forgiving when scouting those pesky Rhodoks, etc., without making you remotely invulnerable.
2. The morale / courage system has been totally recoded from the ground up. It now takes the relative levels of the troops who've died into account, when factoring the change in everybody's courage scores, and no longer takes distance into account, and courage slowly returns over time if no violence is going on. Low-level troops will tend to break much, much more easily than high-level ones will, and if you or your Companions die, the effect on the morale of your troops can be pretty big. But the same thing happens when the Lords die, so it's basically even-ish. On higher levels of difficulty, the likelihood of either side's troops breaking and running goes down a lot, which generally favors the AI's massive human-wave armies.
3. Still working on the regional mercs. What I'm thinking I'm going to do is that the regional mercs are the highest rank in the regional Bandit food-chain, so that Brigand players get access to them more often, and have a genuinely-useful end-troop for each type they can acquire, while everybody else can just get the top-end. It will give the Brigand class more interest and make them more viable, imo (they're fairly hard to get going right now, and it's really hard to just use bandits, even leveled bandits, vs. Lords), and make all the armies more colorful (the Lords will occasionally hire regional mercs). I just have to decide how to make each one unique and interesting and kit them up.