One caveat: spells should be possible to modify some of these rules as needed. 

TROOPS

1) Every unit, including every single solder in a group, will have stats.  This does mean that it's possible for units built with the same armor/weapons, to have different stats.  This would include groups.

2) Levels will add hp like they do now, and raise stats at random (2 points, but player has no control over it).  Units, every time they level past 5, will have a 1% chance of becoming adventurers.  Units in groups who become adventurers will lose 1 troop from the unit, so a group of 3 would become a group of 2, and a lvl 1 adventurer (with the stats and eq they had as a unit)

3) Building experience level gaining buildings will not give free levels, but will instead start troops with higher stat potential.  The dice for their stats will improve for better trained units.

4) Group on group combat would be individual troop vs individual troop.  If the numbers aren't even- then some troops would take multiple blows from different troops.  3 on 2 would be 2 guys attacking 1 guy, and 1 guy attacking 1 guy.  9 on 3 would be 3 guys each attacking one troop.

MOUNTS

1) All kingdoms/empires can use all mounts and build all mounts.

2) Mounts will have different stats, and one of those will be a new stat, waightbearing (see below and needs a better name).  A mount just cannot carry a troop that has heigher weightbearing then what the mount can carry. 

3) You can breed warhorses with advanced stables for either more speed (racers) or more weightbearing capacity (warhorses).  Other mounts may get this also.

4) In the diplomacy or adventure tree, legendary mounts might be discovered

5) Horse archery will carry a penalty.  This penalty will be DEX-based, and higher levels will also reduce this penalty.

ARMOR

1) Armor gets an additional stat- encumberance.  Encumberance will not affect foot speed, but will slow down combat speed.  How much it is slowed down will be dependent on strength.  This is why heavily armored troops will benefit more from experience.

2) Some races that are physically large might have a penalty to encumberance, and vice versa.

WEAPONS

1) I'd like to see a synergy between unit level, weapons, and modifiers  based on this.  For example, a spear/pike unit should gain a cavalry foe bonus, that increases with level.   Other sorts of bonuses could be imagined.  Archers would gain a bonus based on level also. (to train a longbowman, you first train the grandfather)

I think this could be the beginning of a very good, deep system, and I'd love to see SD implement this in either 1.2 or the expansion.  I think these ideas would solve much of the problem with unit balance the game currently has.