The most useful monster.

That's precisely one of the many factors that make Heroes 4 a unique game.

Well, not exactly. Situations similar to the one you described can occur in Heroes 3 and especially in Heroes 5. Regarding balance, you're right; the balance in Heroes 4 is excellent, especially when compared to Heroes 5, where they added 8 factions and even alternative upgrades, but seemingly forgot about balancing. Although, in principle, a normal (not good, but normal) balance can be achieved in all Heroes games (and RPGs) relatively easily. A strong creature? Reduce its growth rate. A strong attack? Reduce its hit points. A race that's too powerful? Make it vulnerable to a specific type of magic. Step by step, and you're done. But a truly good balance is a very delicate thing. The situation you described is indeed possible in a game with a very good balance, where the deciding factor is not the number of monsters, but tactics and, to some extent, originality.