Well, in Medieval 2: Total War, the amount of each unit you could build in a turn depended on the size of your barracks/archery range.

In elemental however, I think equipment production is the key element, and resources will not be infinite, so to wield better armies, and only the best units, you may find yourself severely lacking in numbers, and/or treasury.

Multi-lateral resource acquisition will encourage multiple unit recruitment I think ... like soldiers with leathers + soldiers with plate + equipping  a few on what horses you were able to gather and train. Just whatever you can to fulfill resource availability. As it seems mineral resources will probably be more of a limit than population (I think)

Yeah, that's what I'm hoping is the outcome.  I was left with the impression, though, that having certain resources simply accelerated training time and that you didn't actually build plate armor, breed horses, then throw a soldier into/ on top of them when necessary.

It was a stated goal earlier int he process that a peasant rabble be viable. So I'd say based on that, yes its supposed to be able to hit a knight. If not, there is a balance issue there. It may not hit for a lot, but you don't need to when you outnumber people 15:1.

I suspect you're still going to want some heavy htters anyway, I wouldn't send my sovereign out into the field in a peasant rabble. I'd surround him with the Bloodmoon Guard. But those guys will be too costly to mass produce, so I'll need cheaper soldiers for other things.

Wait till the first time I volcano one of your Monolithic armies in a multiplayer game 

That spell was ridiculous overpowered fun at PAX.

Also, that monolithic army needs to be able to get past Brad's "Ultimate Turtling Strategy in Elemental". So I think a massive army without decent magic protection is going to "Go up in Smoke".

This sentence doesn't make sense with the rest of your post. If you cannot have monolithic armies, if armies are limited in size, then everyone will end up with maxed out armies composed of their most powerful units. This is why armies in games like MoM, AoW, etc always end up being composed of your strongest units. If you only have 8 spots, you will fill all 8 spots with your most powerful units because you will never encounter, say, 100 swordsmen. Or 50 archers and 50 swordsmen, etc.

With monolithic armies, though, you might spend all your resources and spend an immense amount of time training 200 Dread Knights. Meanwhile, your opponent has fielded 50 Paladins and 1000 footmen. These two forces might be ~equally matched. Without monolithic armies, if armies were limited to, say, 500 units... Then your Dread Knights will only have to go up against 50 Paladins and 450 footmen at once, followed by 500 footmen if your opponent is feeling foolish (and another 50 after that). Your 200 Dread Knights would handily defeat 50 Paladins and 450 footmen, albeit not without some decent losses. But your remaining Dread Knights, let's say 125, would slaughter wave after wave of 500 footmen ad nauseam.

Without monolithic armies, what you're hoping won't happen will inevitably happen. Monolithic armies is the natural solution to this problem, because it removes the major reason why it happens in the first place.

We should consider the battlefield

Anyways, with 1000 foot-soldiers, you would flood a good portion of the battle-field with your troops, and your 50 paladins can move about the battlefield at will, striking the 200 dread-knights where their morale and/or fatigue were the lowest, hoping to cause some strategic route or something.

Equally, the Dread Knights could cause a route in the 1000 foot-soldiers, and fight-to-kill the 50 paladins. However lets assume these paladins are mounted ... they can engage, retreat, and re-engage, and if these dread-knights don't have pikes, and are instead swordsmen or axemen, each engagement can be at full-tilted charge, which could wear down the dread knights ... and the paladins would have the advantage of being able to rest on horseback while the foot-men Dread Knights try to chase them. Assuming that first contact with Dread Knights doesn't cause full-on route with the paladins, but we are also assuming these paladins have fairly even footing with the Dreads, at least from a morale perspective.

Meanwhile, a few of the regular footmen units could have stopped routing (while others continued to run off the board) ... and those could be sent, ever so slowly I suppose, towards the dread knights, and the DKs have the option of either continuing to chase the Paladins or waiting until they decide to meet their doom by making a final direct attack. The mobility has the advantage.

Although if we assume the dread-knights are also mounted ... then its no even fight at all, unless those footmen have spears or something. Then it would most likely turn into a flanking war, and if the dreadknights manage to flank and kill all of the spear-men before they run out of steam (become weaker than the paladins) then its a matter of resting up, cornering and killing the Paladin. Meanwhile its the paladin's job to attack the Dreads as much as possible while they are busy butchering footmen from the flank or rear.

You're right, although I don't think it's just about empowering peasants - practically speaking, I don't think decking 10,000 peasants out in full plate and warhorses was ever possible for any Middle Ages kingdom, regardless of the size of treasury - there simply weren't that many warhorses or metal to go around. Most battles had full plate knights in the dozens/hundreds at most, 10,000 of them is a force that has never been seen in history. 

Anyway I think it has more to do with scarcity of resources, and if Elemental duplicates that scarcity - if there simply aren't enough warhorses or iron ore to turn our entire armies into full plate knights (not to mention the magical resources, enchanted swords to create paladins and such) then we should have plenty of peasants with pointy sticks taking part; i.e. as long as population > metal/horses/etc, medieval-style combined arms will result.

Of course if 0 warhorses/iron ore means we can still train knights, but it'll just take 3x as long, we may run into problems - because spending 3x as long training a knight may still wind up a better option than training a bunch of pointy-stick-wielding peasants. It's all about fine tuning the balance, we'll see how it works out.

Or the 200 dread-knights would move butchering footmen, putting always some between them and the paladins until the footmen run away (over the paladins) and after that butcher them too. Or they could make a line to the paladins, kill them and then tell the footmen: you are next.

If HoMM is not a template for comparison (a game that has that mechanic), much less a total invented situation (where anyone can say what he likes).

It was already stated that the two armies were to be considered roughly equivalent ... it depends on game design. Now if we were to use a comparison like HOMM, there would be a one-tile stack of 200 dread knights, a one tile stack of 1000 footmen, and a 1 tile stack of 50 paladins. Time spent moving about the battle-field would have no usage here, neither would endurance, morale, flanking, or formations.

There is more flexibility for various outcomes when each indivudual soldier is its own object (even though units can have multiple persons) which is how the game is going to be played. If you wanted to envision an out-come on a real battle-field that some-how equaled the out-come of the HoMM system, it would be streched at best. Battles simply won't play out in the same fashion, at least in-so-far as 2000 peasants killing 3 archangels, or 2 dragons, or somthing ... or 500 Paladins equally killing those 2000 peasants in a mere 1 or two turns.

Original post edited in order to cover several more examples of action.

Im just saying that a checkerboard with 1-tile stacks of units, and an organic battlefield with a individual objects joined together, have a vast different feel to them.

The actual out-come is not the "point of comparison" but its how the battle is fought ... for whomever's victory.

I remember making a thread awhile back that suggested making this a game feature.  You would essentially have a small, permament standing army of professional soldiers and when you went to war, you would issue a call to arms amongst your nobles with the option of varying degrees of pressure, at which point they would gather their own sub-nobles and peasants to war for your cause.  After the war was over, they would blend back into the population.  In every city you would have a little counter to represent how many men can be called to arms, and their relative calibur.  When you did call them to arms, you would have a mish mash of soldiers depending on what has been historically available in your empire--- everything from mounted and armored nobles to sword and leather armed artisans to spear carrying peasants.

So, instead of training every one of your units, you would only explicitly train your professional soldiers--- the rest of your men-at-arms are in the population of your cities, and you could enhance their combat effectiveness and readiness by improving the wealth in your society, providing drill squares and military academies which they can attend, and making weapons and armor more readily available in your society (citizen soldiers would purchase their own weapons and armor.)  Have a society where wealth is concentrated in the upper classes?  You end up with a massive army of spear armed peasants and a good number of heavily armed nobles.  Have a civilization where wealth and access is distributed amongst the people more equitably?  You end up with a lot of leather and splint armored soldiers with shields and swords.  You could also adopt civics that would allow your citizen soldiers to pillage and scavenge loot from defeated soldiers, which would give them a greater incentive to go to war properly prepared (with perhaps some disadvantages).

Also, the longer your population is off at war, the more of an economic and happiness penalty stacks in your cities, because the economy has been distrubted by the disappearance of workers (these penalties would encourage an "organic" end to wars).  The more dire the call to arms, the more additional "less qualified" soldiers are called to the front and the greater the penalties.  A dire call to arms would naturally be made in a defensive war, which would also give defenders an innate advantage.

I've always disliked the idea in medieval strategy games of training vast swathes of soldiers who then stand ready for an indefinate period of time.  It's a strategy game relic from the days of Civ 1 that most game designers still aren't willing to move past.  It's become very stale, and innovation is long overdue on this point.

good idea for priceless units to play important roles in large armies, but to not be cost-effective to field all-elites.

And don't forget that usually, peasants would return to their home (and harvets !!) after wars. So we would need a way to get back the remains peasants in town after a battle. If we can't, then raising 1000 peasants will be costly because of the manpower lost in city.

And why not an option where units could help in city manpower ?

yea, I agree with PigeonPigeon.