As far as I know:
No, purchased items are just for Sovereign and Champions.
You can't group existing units, it only applies to newly trained units. In the unit build menu, above the portraits of which unit you're picking, you can pick party, squad, etc. and level of veterancy.
There's no way to set up formations before battle, though the ordering of units does I think depend on the party order in the strategic screen - but the only way you can change this is through the in which new units join the stack (they're added to the end).
The first is as it should be (though you should be able to upgrade existing units). Others should be changed.