Heroes 5.5 WarGame Edition - Tactical Edition.

Perhaps some of these, or all of them together.
Because in real life, your skill is still more limited, and a man on horseback with a sword is not capable of taking down... well, let's say, a hippopotamus (I think that's a good equivalent to the gnome's Godzilla). But a commander in a party of five can.
I'm talking about the original game here, as an illustration of this point. Of course, you can balance your numbers very differently (and correctly).

A fiery Godzilla will be stronger than a hippopotamus (the closest analogue to Godzilla is a 7-ton Tyrannosaurus Rex, which could take down 12-ton Triceratops), so a hydra, which is twice as weak, is closer.
It's pointless to talk about the original game here, because the heroes there had a fantastical strength (what about Krag, who takes down 2-4 dragons per hit?).
As for the limitations of skill, why should it be different in fantasy than in real life? This isn't a Marvel superhero universe. Humans, unlike elves or vampires, are not long-lived and cannot hone their skills for centuries. Accordingly, they have no basis to hone their skills significantly better. Magic? Well, you can justify anything with magic, but is it worth it? If you overdo it with magic and make it easily accessible everywhere, the overall level of technology will move far away from the Middle Ages, and it will be a world of magic, not of swords (just as it is now a world of technology, not of swords).

In general, I've thought a lot about the coolness of knights and came to the conclusion that historical accuracy is needed here, not superheroism. Since this is a historical unit.
At the same time, you can approach elven dancers differently. Historically, a naked man with 2 swords will become mincemeat for a heavily armored soldier. But in the case of elves, this may be justified, given their racial agility and vast experience (longevity). Also, because an elf is smaller and weaker than most opponents, while armor/shields are only effective in the same weight category and will not save from too heavy blows. Therefore, a lightweight elf cannot rely on armor, only on his own agility and skill. This is precisely the prerequisite for elven light infantry to be so good that they can compete with human heavy infantry, because they have no alternative.

And where are the units for Light Elves, demons, and mages?

Light Elves do not have cavalry in their army. But if a knight dismounts (although this is not possible in the game), he will lose half of his strength and be comparable to an elven hunter.
If there were winged pegasi (with riders) as in Might and Magic III, I would put them in the same category as knights and griffons.
Unicorns don't really need riders as combat units, but if they did, they would be roughly equivalent to predators (i.e., slightly weaker than bare unicorns).
Mages rarely participate in battles personally (1 unit out of 7), summoned creatures do the work for them, so there can be no racial commandos here.
Demons are too powerful, their commandos are higher demons, balors, and devils. Which are many times stronger than the above.

Added 3 hours 1 minute ago
There is another contradiction that needs to be resolved: brutes and chieftains. The difference in size is huge, the former are 2 m tall, 150 kg, and the latter are 3 m tall, 400 kg. And this is the same race. If the sizes vary so much here (or orcs grow throughout their lives), then where are the intermediate options (and why are there no giant shamans)?

The most plausible version is the use of pharmacology (growth hormone, anabolic steroids, etc.). Pharmacology provides accelerated, intensive growth of muscle mass and skeleton, so an orc who has taken a course reaches maximum size relatively quickly. A side effect of such active use of pharmacology is sterility, so young orcs who have not yet had offspring do not use it and remain at their natural weight (150 kg). The second consequence is that once an orc takes such a heavy course, he will no longer be able to voluntarily stop it, as this will lead to disability or death (atrophied muscles after the course ends will not be able to adequately support the body of the giant). To maintain his form, the orc-giant is forced to participate in wars of conquest all his life, enriching himself at the expense of others and spending the money on pharmacology. Hence the aggressive policy of orc leaders.

Pharmacology (in general, not just steroids) also perfectly explains their racial skill. Orcs are not stupid. Orcs are strong. And shamans are smart. And they built an entire civilization on pharmacology (in everyday life known as "blood magic"), surpassing all other races, including mages.