I beg to differ on the AI handling battles once progressing into book 2.
Once the player understands magic and uses it to the fullest, the AI seems to be unable to counter proper use of magic. If you look ate the relative/comparative power gauge at the battle start screen that supposedly gives you an indication of how tough a battle should be. But it isn't because of magic. Look at the difference in outcomes between autoresolve and hands-on resolve. It goes to show that either the autoresolve is broken (I don't think so because when two equally powerful armies based on power gauge duke it out, is should be a close call which it usually turns out to be) or the battle AI is unable to cope with magic.
Yes, the AI uses decent enough tactics for its 'common' troops, but that is moot as magic will turn the tide of the battle always. When I started playing and didn't understand the potential of heroes and magic, I got defeated more than once and as such the AI is pretty good, but now I grasp the proper use of magic, the AI is just feeble.
Of course, it could just mean that magic is overpowered and might need to be toned down. Maybe a 'weaker magic' option like the 'weaker archers' option? I daresay that would make for more balanced, interesting and challenging battles.