One fairly insane piece of advice would be to try if you can kill the Kraken (talk to Miranda). I did it with swordsmen, guardsmen, archers, standard bears and griffins, which means I had big stacks of everything except the griffins. I took a lot of losses, but the victory was worth it.
The kraken is hard, but not very hard compared to the rest of the stuff you find on the islands. You just have to be prepared to lose a lot of your troops (not a problem if you play with mainly cheap troops). And you can't use rage spirits against it, so your disadvantage there won't hurt you in that fight. If you win, you'll get a huge amount of experience - probably enough to level up once.
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