[Arryn]

I'll let one (or more) of the other experts handle the majority of your questions, but I'd like to point out that routing (ie: the failed morale check) is by group, not by single unit. So an attack that inflicts "auto-routing" isn't an option, to the best of my understanding of the game's routing mechanism.

Unlike in real life, in Dominions you don't have individual troops peel off from combat to run away. The entire squad will break and run once it's average morale drops low enough and it fails a check.

Also, fear inflicts morale checks directly. Attacks by the fearsome unit are not required. The fearsome unit just has to be close enough. Before you ask, I don't recall how close. Someone else can answer that.