Well I finally got around to traversing most of the tech tree, and have the following concerns:
Upgrade Costs: The cost to upgrade your regular army units is ludicrous. I mean there has to be a patent for how absurd these costs are. To give an example, to upgrade a guardian unit (max armor and shield) of 5 from leather to chain costs 7700 gildar! I could rush by at least 10 of those with that! It seems like the costs to upgrade were simply calculated using the base cost of the item (from the merchant) and multiplying by the number of units.
First off there is no way in the nine hells that any player will have this much gold lying around unless the game has already been decided, making this option, not an option at all. Upgrading weaponry isn't much better either.. In any case very clearly the cost to upgrade units should use a small percentage of the total cost. I recommend 10%-15% which should make upgrading still a very expensive (do you have 700+ gold lying around to spare for every unit you produced?) but viable option.
Item Costs: There are a couple rings (fire and ice damage) that are available for zero crystal cost. These should probably cost .5 crystal each to prevent every custom unit from gaining an extra 2 attack. Additionally the cost of iron units seems a bit high, or the rate at which you gain iron seems low: 100+ iron for a fully armored unit seems excessive considering you are likely to average 3-4 iron a turn.
Auto-Upgrading Units: In theory this seems like a good way to get the AI to upgrade their military, however.. given the rarity of iron versus the cost to produce (see above) what will end up happening is the computer will no longer be capable of fielding defensive (melee) type units, and all their armies will be entirely composed of archers. It will also force the player to design their own custom units with 'downgraded' technology so they can produce units to guard their cites.
I'm currently of the mindset to simply scrap iron as a resource altogether, or make it so plentiful that you only need to hold a couple deposits to maintain a military or cause units to consume iron/turn in order to prevent you from building more than x at once, but once they die they can easily be replaced.
Crystal should remain as is, it is supposed to be a rare resource, but units should definately not auto-upgrade to this armor/weapon type.