here's my two cents (which is about what it's worth).
the heroes you get are the ones in your war council.
a level one hero has a green banner
a level two a blue banner.
a level three a red banner.
heroes can attach to units and apply hits aginst the unit they are attached to.
attached heroes roll their dice before the units they are attached to.
heroes issue challenges.
the elimination of an attached hero counts as a flag against the unit the hero was attached to.
a hero is bold, equivilant to his level, thus a green hero ignores one flag, a blue hero two flags, a red hero three flags
they also hit on bonus strikes.
any lore rolled by a hero is placed on that heroes portrate in the war council sheet, these lore may be used by this hero only.
each shield rolled against the hero negates a hit against the hero up to the heroes level.
example combat: a red cavalry unit rolls four dice against a blue heroe with a unit of infantry, the cavalry unit rolls a flag, a red helmet and two shields , normaly this would result in a hit against the target unit, but because of the twos hields no hits are registered the flag would also be ignored. If however the attacker rolled three shields a hit would be registered, because the heroe is attached the hit could be applied to the infantry and not the hero.
example two, challenges: if the attacker in the above example were to have a hero attached a chalenge would be said to have been issued, in which case the first hit that goes through would be registered against the defending hero.
i would give no other special abilites to a hero since their special abilities are in the form of the lore cards themselves.
so I would see the packaging of a hero expansion as follows:
one of each type of hero for each camp (ten figures).
two red standards, two red pennants
three blue standards, three blue pennants.
six green standards, six green pennants.
this packaging would facilitate any combination of the default level six war coucil, and prevent a "superhero" war council with three red heroes.