This is a huge improvement over the first beta for FE!  The hero progression is much better.  Here are some thoughts I had on ways to improve it:

1) Have a settling for max cities.  Managing a lot of cities gets tedious, so a setting where each character can only have X number of cities and X number of outposts would be fun.

2) There seemed to be less quests in this version.  I did not see any low level quests near my starting position.  I love doing quests, so the more the better!

3) Being able to set how many special environment areas (like the Scrapyard) there are in each game would be nice.  My ideal world would have all of them.

4) The battles are getting much better!  It would be great to introduce even more strategic elements, like squares on the map that reduce/increase magic, or squares that have treasure chests.

5) The Empire has some really awesome looking Heroes.  Can the Kingdom get some really unique heroes too?

Keep up the great work!