I've never played AoW 1 before, I've only ever played AoW2 and later 3, but I got the first one and am quite pleased how very much like 2 it is, except for the difficulty. I picked the Dark Elves campaign, but is there a difference in the difficulty between it and the light campaign? It seems pretty hard.

My experience was that the first map in the Cult of Storms campaign is harder than Keepers. After the first map, it tends to even out.

Hm, I managed to beat the first Dark level, somehow. Just kept trying to hang on and win fights cause they kept attacking me, I guess the enemy attacked me with their mage and the game won after I killed it in the battle.

But the second level is also pretty hard. You apparently only get 20 turns, but that's hardly enough to build up any kind of city at all.

I tried the Light campaign after that, and I didn't finish the first level yet, but it's very different. You got free units scattered across the map, free cities, all just there waiting for you.

I guess the Light campaign really is intended to be the first one you play.

The first dark elf mission is quite unique, you're supposed to go all in an kill the elf leader in like 7 turns before she can amass forces, but since you only know where she is if you've played it before, it's really hard.

The second mission is just a matter of moving to the end of the map quickly, recruiting units isn't important.

I think quitaraxe is referring to the first to levels of the Cult campaign, where you play Goblins. Instead of the later Dark Elf levels. In that case, yes the first mission is much harder. The Mission with only 20 turns you are meant to keep moving and not built up forces, unless you get lucky and kill the enemy leaders in the first few turns. Most of the campaign is centered around very powerful heroes leading stacks of units. You may wish to play a few regular scenarios first to get a feel for the game.

So I take it then that unlike AoW2 there isn't really much turtling?
I mean turtling in AoW2 is my pet peeve, where I can't seem to stop myself from doing it.
And here in AoW1 the few towns I've managed to capture so far I don't even see how I can upgrade.

A city's maximum upgrade level is equal to its number of hexes.

About turtling, hard to say, you can stomp a lot of AI disorganised forces with just a couple good heroes and a beetle to kill walls. But you can also indulge in turtling if you like.

You shouldn't be building up cities, except walls for the first goblin city. More effective to loot enemy cities and buy friendly ones. If you play without foreknowledge you will probably split forces, and then realize that the Elves have a huge force in the south-eastern part of the map. There's also a sign in the starting caves indicating which way to go.
If you fortify the goblin city you can prevent the south eastern part of the Elven army from threatening you and can concentrate on the Elf leader.

Just my 2¢ in case your hero/leader itself may be an issue, consult this thread of mine here: https://www.gog.com/forum/age_of_wonders_series/looking_for_suggestions_for_building_aow1_hero_for_story_keepers_and_cult_of_storms.

I am currently working on the Cult of Storms-Dark Elves route myself (still in the Goblin phase). In case the link somehow doesn't work, here's a summary for what's there.
1) At character creation, go with the Lightning Strike and Life-Stealing perks. You can only get those then and the former makes a boatload of difference while the other is still highly useful.
2) Pick Wall Climbing at 2nd level as well as 1 point in Defense. Work Defense (the stat with the shield icon) and Attack (sword icon) up to 10 (which is maximum) from there; you can at least temporarily use items like cheap gear from abandoned castles/monster lairs/etc until you get to 10. After those are up, work on damage (the orange starburst icon to at least 5 and otherwise try to spare points to build up your Spellcasting. Otherwise, get perks as you see fit. Extra Strike can be helpful, for one.
3) Get a weapon (likely a pike) from a monster lair/abandoned castle that has First Strike ASAP and carry that with you throughout the entire campaign.
4) Acquire an additional hero and keep them out of battles as much as possible. When the level up, pool their points for Spellcasting perks until the get Spellcasting V. This is your mana battery to boost your spell research as well as upkeep for unit buffs and/or summoned creatures to supplement your forces. Give any other heroes you get Spellcasting perks as well as conquering nodes associated with your spell spheres and you'll have plenty of mana.

In case how to use Dark Elf units is an issue, would these links help?

http://aow.heavengames.com/strategy/sddarkelves.shtml

http://aow.heavengames.com/units/unitstats_dark_elf_ts.shtml

That's all good advice on how to make the game too easy and IMO too boring.

Anyway, the game breaks when you get dragons and physically immune units into play. I had a Grim Reaper who wiped out most of the humans on the last map. Joseph himself didn't have a chance against a Black Dragon. And by the time I had installed top Goblin unit (to conquer the underground) the game was already over.
Not very satisfying if treating the game as a strategy game.

Which again reminds me why I think Shadow Magic is so much better.

Don't know if I should feel flattered or insulted over that.

Well, it *is* good advice on how to make a powerful leader.
But with too powerful a leader the strategy part pf the game kind of flies out the window, when your leader can just head for the enemy leader and assassinate them. DEF 10, First Strike and Cold/Lightning Strike is a combo that is almost impossible to counter, at least without magic.
But as I said, the OP leader is a general weakness of the first AoW game.

When I replayed it recently I deliberately nerfed my leader, first by choosing a default one and thus no elemental damage skills, and then by waiting with pumping up Defense.

I think it makes the game more enjoyable that way, even if it takes more micro management. But as the undead the game kind of breaks apart when you can easily get PI units, so that path is my least favourite of all the campaign paths (it also has rather boring maps, some more suitable for multi-player).