I dunno, Levels worked pretty much fine imo. Otherwise there isn't really any 'development' to be had for your character at all, which doesn't really work imo. I think it's good like how it is now, maybe have creatures generally level up faster or further so that we can unlock more of their potential anyway. Obviously Drell is a special case, but he isn't like a playable unit, so he could play by different rules.
I wasn't thinking of a radical change, just something like 3 units per realm and 5-6 units total. That shouldn't be too bad with the one-man-armying.