I haven't read any manuals - I usually learn best by dissecting.
And I spent four hours yesterday to get a good understanding of the mechanics and can pretty much breeze the first introduction level.

On the second level, however, it seems that I get attacked and wiped out too quickly by the opposing Etherlord who is about 4 levels higher than me by the time we meet up.

The second level starts off with two heroes and I think what I am doing wrong is attempting to level both evenly when perhaps one should collect and the other battle so as to level quick enough to face the enemy?

Any suggestions?

Any one other than me and my Win XP getting this game to work? XD

I've only played the sequel, not this one but if the game system isn't much different I'm guessing you haven't cracked the tactic yet.
Usually when I get stuck in the sequel it's because I haven't figured out how to beat the opposition. A lot of the enemies are more or less specialised and you need to use a certain tactic and cards to beat them. Once you "crack the code" of a certain enemy they become much easier.

I know it isn't much help and since I haven't played the first I might be way off. :/

Thanks for the reply - I've noticed that some of the strategy is similar to other card games in the sense that you have play an enemy enough times to know what it's summonings are capable of so that you can decided rather to save ether, to play larger cards, or start expending it immediately to take down the summons as soon as your opponent places them.

Yeah. Also the enemy usually have a combo. If you manage to break or disrupt it you're a good way to winning.

For my Win7 Etherlords works quite fine - I remember having problems with WinXP SP3.

Probably, it's only decision - to grade one hero instead of two )

Yeah, I haven't had issues on XP SP3 myself but I hear others having some difficulty - Not sure what OS they're using.

I leveled only one of them in time to meet with the opponent who tries to get over to my castle as soon as possible. I faced him off two levels under his but I had upgraded cards.

That one opponent was the strongest opponent in the second level and the only problem. Once I took him down the rest of the level was a cake walk (I'm playing on Normal).