Revamping the unit-battle or cities system will be the first thing I mod. Bottom line is: adding initiative, special skills, training system (part of equipment), resistance; city wise: unhappiness factor, caravan system; races: distinctive differences (pros and cons) of Kingdoms & Empires.

I'll be modding races ASAP.

Just human/fallen is too boring. I won't be doing art assets (because I lack the skills) but I intend to have some fae/elven races available. I particularly want to do something very "fair folk" like an aggressive militant civilization with life magic.

If I had modding powers and time I would first mod in some new races, then try and make a mod out of favourite books (as already mentioned), e.g. I would love to have a Hyborian mod (Conan) with snake people in the South and barbarians in the North plus a lot of demons summoned from beyond. Then I would try and mod some om my own campaign work for Dungeons and Dragons. Would be so fun to share with the old players'  team! Lastly I would mod in a good espionage and assasination system and new spells to wreck the world.