So, in general, LH is a lot of fun. I'm really enjoying the game, especially the fact that there's now a good reason not to have like forty cities in my empire. That's really great; managing a big empire is a lot of work, and it's nice not to have to do that in order to manage to survive the AI. The effect swarm has on tactics is AWESOME. I was skeptical of giving units weapon specials (especially sort of silly stuff like "oh, spears can impale two squares") but having played with it, I am happy to admit that I was wrong; it's great.
Good stuff aside, there are a few changes which are a bit frustrating.
1. Leveling is a lot less fun. It's slow - on a sovereign with General, Knowledge, Potential I and in an army with a Trainer IV henchman I still was unable to get to level 20; that's a (1 +(.25 + .4)) * (1 + (.25 + .15) = 1.65 * 1.4 = 2.31 multiplier on the sovereign's xp. My sovereign was the only champion in his stack for nearly the entire game, so the xp wasn't divided. I killed a bunch of Strong armies, a couple deadly armies, and the Winter wildland epic guy. Leveling should probably be faster.
It's not just that leveling is slow, though. The level-up trees lead to fewer meaningful decisions. In FE, I'd usually choose between 2-3 good abilities and 2-3 bad (well, undesirable) abilities at each level up. In LH, I make one decision from the start: what capstone ability am I going for? Then I pretty much take the prereqs for that, most of which are not very fun. (+2 to army dodge and +5 defense when defending, YAY)
I'd suggest shortening the trees, broadening them, (so fewer prereqs and more options) and letting characters take a second additional path at level 15 or 20. This would be an overall champion buff, yes, but the champs kind of need it.
2. The early game is much harder. In FE, you could be expected to be able to clear out a couple of low-level enemies with just your starting units. That is now impractical, mainly due to swarm. In some cases this is a premature game-ender, because I might find myself cut off from expansion by enemies that I can't really handle, but that I really need to expand to be able to have the resources to build an army to kill them. I'm not sure what the best way to deal with this is; an overall champion buff would no doubt help, as would just trying to make some relatively safe expo spots (say, enough for 2 more cities) for each starting location.
3. Spells are very uneven. Revelation has been entirely removed (that was my favorite...) and arcane forge comes far, far too late for it to be useful; by that stage of the game I've probably built most of my buildings and troops are coming out of a fortress at high speed. Most of the direct-damage spells are pretty terrible. Flame wave, in particular, is almost always worse than fireball and flame darts, despite being a higher-level spell. Burning hands is a pile.
In general, I'm not really a fan of making spells that were previously buyable with research now cost trait points. Trait points are very much more constrained. It's now in my interest to keep around a low-level champion or hench who just gets the gentle rains spell so that I can super-grow towns, and then park him in town forever.
4. Damage estimates are wildly inaccurate. I can't count the times I've hit only to see damage lower than the minimum described. Many special abilities incorrectly predict 0 damage. It would be nice to see how much damage is coming from swarm.
5. A comma is used to separate words and phrases; a semicolon is used to separate clauses. See, in particular, the text for Agonis, which, apart from this error, is very well-done.
6. The mouseover for gildar should make explicit that the tax rate gives you tax rate % of your cities' gold. So rather than "Revenue" and "Unit Wages" it ought to say "Commerce in your empire: G", where G is the gross, then "taxes (X%): Y" where X is the tax rate (40% for low), and Y is the earnings. THEN you can deduct the unit wages and all that. I had no idea what on earth was going on with gold in FE until I got to the forums.
7. Give a warning when we're about to end turn with no research. This is almost always a mistake.
8. High-level city bonuses are still pretty underwhelming, and growing a city to higher levels takes a LOOOONG time.
9. If I put an outpost between a city and an existing outpost, and I've researched economics, and they're all close together, the new outpost should connect its road to both, not to one.
10. I’d love to be able to upgrade a unit’s mount.