My very first playthrough ended with alexander while all the party was at lvl 7 without any really useful gear equipped save for braccus' set. I still managed to get out of the fight with relative ease thanks to judicial use of every single usable I had in my inventory (which were a ton, since I always make a point of ending fights without using consumables unless 110% necessary). What really saved me was teleport to get blinding radiance alexander away from my squaddies and then netherswap to have my main (wizard lohse) change position with the enemy mage high on the right. Then the big worm came in and basically obliterated every single enemy bar alexander (who got petrified by cursed earth spray). Surprisingly, I found the worm to be much more challenging that alexander, since it has high resistances and hits like a mac truck. Alexander does as well, but he is at least very easy to crowd control thanks to almost non-existant resistances and no particular immunities. What really saved my skin was a strategic use of bless on a pool of blood which healed all of the other characters. Keep in mind that this was with a minimal gear + minimal skills because I was always broke.
Second playthrough: managed to get to lvl 8 before the fight, also had tons more of cash thanks to all the paintings of alexander scattered all over the keep, which obviously meant more neat gear and more skill books.
This time, the fight was a cakewalk. I had kept sebille and ifan ben mezd in reserve, away from the fight, up until alexander cast that blasted brilliance and blinded lohse and the red prince. The red prince took care of alexander's armor thanks to overwhelm, then I had lohse swap position with the magister wizard on the right. Sebille joined the fray with a snipe that 1-shotted the wizard, after which it was ifan's turn who entered the fight in sneak and used that ability which grants 500% damage against a backstabbed foe if you are undetected, which instagibbed alexander. Then the worm came in, killed the geist and a couple of magisters, and then proceeded to attack my group, but thanks to gear + potions + spells it was very easily dispatched.
I was playing on classic on both playthroughs.
All in all, it's far from an impossible fight, even with mediocre gear and skills, as long as you have teleport (netherswap isn't mandatory but it helps) and a sound plan (like, say, having your backstabber and sniper stay out of the fight until alexander and the wizard mage are exposed).
Also: there's a conveniently placed barrel of oil not so distant from alexander's roaming zone...
