If you have a lot of recruits and place them at the bottom of your list, they won't participate in the battle unless you need reinforcement and you actually need them. It is normal that most of your units leveled fast at the beginning of the game if you used all of them in every battle. I think units only level if they actually kill a unit, otherwise they get no or very little XP. And of course they get XP when you train them with the trainer skill too. That's how I level my troops anyways.
Also, there is some troops which are insanely powerfull against others. Like Rhodok infantry against Khergit troops for example. Or knights in sieges are also insalely powerfull (versus other units) because they are so armored they can shrug off a lot of arrows before dying.
Also, nudging the difficulty a notch will help you have a bigger challenge. There is several options to tweek in the option menu. One of them is the amount of damage dealt in the game. The default is ridiculously low... If you try a "realist" setting then you'll see that you won't be able to solo a 80 man army like I used to do when I began playing.
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