I suggest not using your mages in combat, since they can't hit anything=) Instead, send them off site-searching or cast site-searching spells, then flood the world with Summer Lions=) If you want combat magic, forge fireball wands and give them to cheap indy commanders.
Also, dedicate at least one 5k+ size province to slaving, set the tax to zero, and with the slave income, start forging Sanguine Dousing Rods (unless, as I would hope, you already have some), then use the boosted slave income to make +Blood items, then Soul Contracts. I think these are weakened from Dominions 1, but still very effective. Once you start getting lots of free devils, the game should be easier=) Be sure to put the contracts on cheap indy commanders, because they get horror marked... and put them in a province alone, so that when they die and drop their contract, a new indy commander picks it up, not some precious mage that you don't want to lose to a horror.
I also am fond of putting a fire helmet and Lifelong Protection on Slayers... then they can pretty much have their way with most enemy commanders=) You may want to give them a lucky shield, lead shield, or barkskin amulet, of you have the appropriate path. The Lifelong Protection was so strong in Doms 1 that my slayers (with Main Gauche, Fire Plate, Ring of Regen, Shield of Valor, Fire Helm, Lucky Amulet, Boots of Messenger... rainbow mage pretender, as you might imagine) could take big enemy armies alone, when stuck in the back corner ordered to cast spells.
But as for the late-late game, I can't help since I've always been level-4 spell limited
