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I propose a revolutionary idea. Perhaps it doesn't even belong in Heroes, but it will be the basis for another game.
The main idea is that each unit has an indicator of how many units it can kill in one turn. At the same time, unit abilities can influence this.
For example, a paladin swinging his sword won't be able to kill more than 5 units.
What does this give? It means that each type of unit will be stronger against units that are 1-2 levels weaker, as well as against those that are much higher.
There will be exceptions, but their cost will reflect that.