tl;dr version: Beta 3 is miles ahead of earlier betas, which in turn were better than War of Magic. However, there still is much to be done to make the game really good (not saying as good as Master of Magic, as the previous 20 years taught us: you can't top MoM).

AI & DIFFICULTY LEVEL

The early game is hard. You have one or two weak heroes and half the monsters on the map can squash you. Settling takes time and you need to be careful not to anger any monsters. That is good. AI starts off real fast and is much stronger than you in the early game, mostly thanks to settler spam (I will deal with this problem later). The main problem here is the completely random starting point on random maps; you could find a 4/4 spot with resources and nodes nearby, or you might be stuck with a 3/3 and nowhere to go. Someone (can't remember now) came up with an idea to have your capital settled already on a spot with predefined resources when the game starts. I agree. 

However, when your champions level up a bit and you have several growing towns, AI falters. It sends to war stacks that have no chance whatsoever and its development is hindered. This has to improve. 

The last and most infamous thing is that AI settles near monsters yet doesn't feel the consequences. Angered monsters either wait around the settlement or go attack the player. It's really stupid and definitely has to go. I hate cheating AI in games, but still would prefer it to have resource/food/production bonuses rather than shitty gameplay handicaps (of course I'd rather have none of above). 

Another thing involving monsters. Why not make some (not all) lairs like in MoM: you don't know what's inside unless you scout it, but its owner won't get out while being in a city's ZoC. That makes settling a bit easier.

Rating: B-, small yet gamebreaking cons

CITY MANAGEMENT

Supposedly, it's getting a total transfomation in the next build. I don't see the point of it, however, because right now it's the strongest feature of FE.   There's enough micro to keep entertained but it doesn't get out of hand. All the features: taxes, food, production and research are clearly explained and fine. Buildings are ok. Two things that should have been fixed are production not being transfered (at least a % of it) from a cancelled project to the next in the queue, and the fact that tile improvements (like shard nodes) sometimes being built on their own and sometimes getting on the queue (is there a rule for that?).

Oh, one more: pioneers are too cheap. Founding a new town should be a major undertaking, not something you can try every couple turns. Right now pioneers are cheaper to train than every single unit aside from peasant mobs. It should be much more expensive and incur a penalty to its home city (-10 population at least) to prevent them from being expendable spam-unit.

Some faction-unique building would hurt too, as I'm a big proponent of completely unique races.

Rating: A-, only minor tweaks needed

COMBAT

In WoM combat was terribad, and though it is much better now, it leaves much to be desired. The current hit/damage system is mediocre and I've come to terms that I won't ever be as good as in MoM - but right now it's a game of whack-a-mole. My main gripes:

•  The battlefield is too small compared to unit speed. Excluding foot soldiers, almost every combatant can reach the opponent on the very first turn. It's disastrous and makes ranged units less valuable. Either make the areas much bigger or lower unit speed, to the point when footmen get one movement point (that would mean major balance changes on the world map obviously, so the first solution is easier).
• Attack of opportunity - unit leaving melee combat would give a free normal attack against it to an opponent - only one such could be made by one unit. It's a counter-balance to my previous idea and makes positioning more important.
• Weapon balancing (https://forums.elementalgame.com/424841 a great post, I have nothing to add)
• Tile bonuses: hills increasing range of archers, forests giving penalties to cavalry and swamps to every encumbered fighter; not to mention some special, unique ones, when fighting on, for example, a shard node.
• Special attacks are nice, but there should be more of them.
• CAMERA! Scrolling the battlefield right now is a nightmare.

Rating: C-, not very enjoyable right now.

MAGIC

Definitely not good enough. There are several things broken right now. Again, this post raises some great points. I'll only add that there should be much more overland spells, especially summons which are completely forgotten right now, and they should take several turns to cast (as opposed to some combat spells, i.e. wither is useless as it takes a turn and the effects are negligible - MORE BALANCE!)

Rating: D, has to undergo a major revamp

FACTIONS

It's all about uniqueness. I think it has only started right now, so I'm going easy on game here. Magnar is really cool and atmospheric with its traits - especially their spells that combine with slaves. The other factions are booohriiing right now though, and traits such as "faction starts with shard harvesting" are very, very stupid. Look, of course, at MoM: their races, albeit poorly balanced, were all unique and had their own playstyles. What would I suggest:

• base stats more varied (Trogs could be much STRONGER, but take longer to build), r
• more unique units (overally I'm not a fan of 'build-your-own-soldier') like magnar slaves or mountainfolk golems. One faction (like Trogs) could have a strong creature available for training early - and thus an early-game powerhouse, great for rushing and on small maps. Another (let's say wraiths) might be weaker early on, but have an almost unbeatable monster for the end-game. Different styles = GOOD.
• focuses on technologies (Altar on adventuring, Pariden on magic), magic schools (wraiths on death, magnar on fire), city growth, food harvest, production
• more passive abilities 

Rating: none (too early to tell)