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I never upgrade Peasants. Why would I? They should bring in money and be retrained into Archers.
Archers with retaliatory attacks are always better. Especially good for clearing out mines at the beginning. It's particularly satisfying when the hero is Dugald and he already has 25 of them.
There's usually not enough money for the third tier. So, I buy a small group of Shieldbearers to protect the Archers. Otherwise, it's good to upgrade them into Monks, because with their initiative and speed, they aren't very useful.
I prefer Royal Griffons. First, their survivability increases because the Griffin spends most of its time in the air. Second, the pike attack is an excellent way to harass Archers, Mages, and low-initiative creatures.
The only exception is when I have a hero who specializes in Griffons. She greatly improves them, and with Stone Skin, they become an excellent unit for protecting Archers.
I like Adepts more. All the positive effects that an Inquisitor applies can also be done by the hero. But removing a positive characteristic is very useful. They also attack more powerfully, and I like the Adepts' "Dispel" spell much more than the Inquisitor's spells.
I always take Paladins. A defense bonus of 4 is no joke (even if the damage is lower). And the Berserk protection + healing is always more appealing to me. The only exception is... against Orcs and Elves who don't use Dark Magic, Isabel's Knights can be more effective.
Archangels, and only Archangels. Resurrection is the key to victory. And if you curse a fallen Archangel, the damage becomes ridiculously low, and you can't curse an Archangel anyway