Given that - each person in Elemental is an individual, I’m more for a skill based unit design, you should be able to recruit a peasant, a raw recruit, and train that person to a role. Warrior – Scout – Caster – Healer etc. and have a grade 1 recruit.
The roles should have different levels of training and as they advance cost more to train and have greater ability to use equipment at higher levels. Warrior becomes a Guard – Guard becomes a Knight - or whatever labels you want to use.
You recruit a Warrior and have a choice – use him as a grade one combat type or send him back to the barracks and train him into a Guard (grade two combat type.)
A Warrior might be able to use leather armour while a Guard might be able to use leather armour and chain armour – while a Knight would be able to use Leather, chain and Plate.
But you could not train a Guard until you had the technological advance Veteran Units – or a Knight – until you had the Expert Units advance.
A Guard would have a higher attack, defence, and health than a Warrior. A grade 2 Mage would have would also have higher casting skill or magical power than a grade 1 Caster. A grade 2 Ranger would have greater stalk and hide and wider perception than a mere Scout. Etc.
Units should be able to gain experience and progress up higher levels by being played and surviving combat in the case of warrior or maybe time spent undetected in enemy territory for a scout.
When it comes to equipment, everything you make or harvest should be stored. You could trade the Mithril ore or send it to a blacksmith to make armour and weapons. You could then trade the armour and weapons or use them to equip Units.
Creating units should depend on what you have in stock - if you train a Knight and then make a Mithril Helmet, a Mithril Plate Mail, a Leather Boots and a Mithril sword then you equip them on the Knight and call him/her and Dread Knight. That then becomes a template. But you can’t create more of the template unless you have the equipment in stock and an available recruit of the proper type and level. If you don’t then you can’t make the unit. So Choice A. But -
When it comes to micro management getting boring I’d suggest that “simple equipment” and “simple recruits” always be deemed to be available – you always have - As examples - Iron, Leather and wood and grade 1 recruits. Etc…
You can always make Leather - Iron and wooden armour and weapons – so that this simple equipment can always be equipped in any unit template without having to have it in stock.
I’d suggest that “Iron”, “Leather” and “wood” be deemed to be the standard and receive +/- 0. Which means all players can design units with standard gear and no bonuses without the need of extra resources or micro management.
But advanced resources – Mithril – adamantine - dragon Hide - Yew Wood - whatever – have bonuses. Mithril armour deflects more than Iron and a Adamantine sword does more damage than Iron. So the players who want to micro manage and train higher level units or create higher level equipment can.
This also creates a more gentle learning curve for the game. A novice player might play with all Iron equipment but then slowly learn more and more about crafting and training and create more advanced units. The AI on computer opponents could be set so on Normal they use standard training and equipment but on hard the AI opponents start to take advantage of training and on very hard the AI uses special training and crafting or something.