It was easy to defeat the dwarf before the portal.
I'm a little embarrassed to ask - what difficulty level is this? For me, this is still one of the most difficult missions - I probably replayed the final battle about 10 times. That nasty Rolf, with an army that wasn't inferior to mine, kept casting "Enslave" on my Rakshasa! Of course, I also used dark magic, but there weren't many targets to cast it on - only the Jarls/Earls. But my Rakshasa managed to cut down half of the army. And when "Enslave" was reflected a couple of times by the magic mirror, it became easy to win.