Well... first of all it adds clases to the game, which determin how are you going to play. Of course you still can go however you wish, but playing as, for example, Sorcerer would mean that you have better spells, no? :)
With clases goes changes in researching - before your mainly researched spells that went with your elemental affinity. Now - you mostly research tech trees of your class, including empire upgrades, new units and spells. The elemental affinity picks are still there but it's... around 5 things to research at level (you can go to levels, for example you can me Fire Adept or Fire Mastr). There are also non-elemental 'specializations', like Expander or Explorer, which will give you their own bonuses and upgrades to discover.
In empire building mechanics... we are between AoW1 and SM... and Civilization 5. First and foremost - your leader don't have to stand in the capitol whole game. He's back to being the Hero-Avatar figure, like in first game in the series. He can be killed, which will send him to the Void (AoW2/SM), resulting in halting research, no spellcasting and, of course, penalties in moral of empire. The current city 'radius' determins just which objects on the map will give you benefits (as long as they are not occupied by enemies and/or are explored, back to it in a sec). But you can cast spells with your leader in a battle as long there is at least one your unit there, but with double the cost. Other than that... city building is the same as in AoW SM to most of it's part - cities generate population, which expands them, building stuctures in them is the same as in SM.
There are also independent cities/dwellings now, that work like independed cities in Civ 5 - you can warm them up to you buy paying them, doing quest for 'em and so on... Some of the dwellings can contain special, 'smaller' races that are not playable per se - for example Fey, Sirens, Naga, Giants. OF course you can just go an conquer them, if you don't want to wait for quests or just want them faster. :)
Combat - also few changes here. Two come to mind instantly - there is no longer 'dodgeball' - unless it's a special case attacks always connects, but high armor prevents the damage. Second thing - you can only cast one spell per turn in battle, either be it your avatar or a hero. One spell per turn. Other than that... flanking in crowd control skills became more important than ever. AI use it ofter and getting stunned means you are constantly flanked, which gives bonus to damage, so placement is crucial.
Of course - the stats for races and units were rebalanced, but this is just a side note.
I think I cover most of the changes... Maybe someone will add to this, if I skipped something. :)
Post edited July 18, 2015 by Bethezer