Yep, grenades provide a great deal of shock value, even if they don't do a lot of killing.
Another thing I've found that works is ordering my men to hold fire and lining them up, once the enemy is in reasonable range I give the fire at will order, and the massive volley of all troops firing at once has seemed to route some of the lesser troops. It can be pretty devastating, so long as you don't wait too long.. because sometimes your musketeers will derp and continue to stand there with their sword drawn...