I started over twice.
It was very tough for me and I didn't even get as far as you did the first time and I've played several similar games so, don't be so hard on yourself. There's a lot of tricks to learn and tactics is often something lost on the first playthrough because the enemy often just pops up and you are in a tight formation. In the Dalis fight you speak of, you win by surviving long enough for Malady to cast a spell (maybe 5-6 turns?). Teleportation spells to get enemies away from her, trying to heal her and give her armor protection, whittling down opponent's (close to her) physical armor to zero so your fighters can knockdown enemies with the ramshead and hammer icons (on the fast action bar), knockdown arrows, etc. Spells are weak for the most part except a few and enemies scale so not much more relative damage is done so I have found it best to concentrate on one or the other. Three mages can break armor then do well. Three physicals (fighters, knights, etc) and one mage with physical breaking spells worked well for me. Also, summons are definitely a good thing to occupy enemy characters (if you get to summons 10, you get a really cool helper). I like to have at least one mage or one fighter type because some enemies have no magical armor and some no physical armor. Do use military intelligence (you can examine enemies to see what their strengths/weaknesses are by right-clicking on them then left clicking on examine). I think I'm on my eighth playthrough and still enjoying the game - and still learning new things each time.
