I really liked this game.
I remember the original (which I also liked) and think that this one was an improvement in almost every way. The art looks even better, the tone is still light-hearted fun, and the mission descriptions add reasonable depth to the story. Unlike the first game, where I felt doomed to lose the first year and be unstoppable the second year, this game manages to be competitive from the get go. The enemies are balanced enough to be challenging yet beatable throughout. I enjoyed having to choose which missions I would try for based upon the suggested difficulty rating. I do feel that having harsher punishment for failure beyond lost time (is having your companions die too adult?) would make the game a bit more intense. I do understand that you seem to prefer making this game not be...gritty... which is fine. The only exception to the pacing is the end game - the quests become annoyingly automatic, but the boss may require some grinding - but I think a little bit of grinding is ok and this is not really a drawback. I think the economy worked pretty well, with the player scrapping to accumulate gold, crystals, and honor at a reasonable speed. Having to balance questing, training, and conquest was a nice touch. The questing seemed reminiscent of another RPG I have played, can't remember the name (top-down view, only saw your char's hat...), but am wondering if you did that one too. The only weird thing I noticed is that the Blades' quests seem to fall dramatically in difficulty about halfway through (may just be random chance too). It is not really a mistake, but it is odd. All in all, a pretty awesome game, which I very much enjoyed.
I do not feel that there are any glaring problems with what you created, but do have some suggestions for the future.
1) You allow for the player to maintain a large roster of characters with different abilities, but actual gameplay promotes trotting out the same lineup every battle. You went out of your way to advertise the names of your tourney opponents in advance, but did nothing to encourage the player to adapt to them. We do not know what the enemies consist of until we face them. Even if we did, the advantages of each unit class do not outweigh the benefit of playing your unique players in every situation. In most strategy fighting games decision making works something like this: Facing a group of horsemen? Pikes or spears may help. Magic-heavy opponents? Use chars with resistance. And so on. The strategy in this game revolves around finding five "unique" teammates and then using them for everything. This is not "wrong," but I felt like you squandered a prime opportunity to add an additional level of strategy.
2) The recruitment/team building part of the game works quite well and is fun. I particularly liked that you had to either complete challenges or fulfill requirements to unlock the various unique characters. I do not have a Kongregate account, so I do not know how that particular character plays. While being prompted mid game to switch internet sites is kind of a jerk move, I will grant you that it was very possible to beat the game without the Kongregate advantage. In the two times (Normal and Hard) that I played, I found that the recruitment process worked best early to mid game. My only real issue with it is that I found the game's economics encouraged me to push to get the first five guys I could afford and to hold pat while experimenting as little as possible. That being said, I did like having to choose whether to devote crystals to my non-unique placeholder characters or to spend cash upgrading by recruiting. Making the player choose is a good thing. Unfortunately, it seemed like (apart from those with a lvl 5 class change) any non-unique replacements I uncovered were either equivalent or slightly behind my original five. As I tended to find the superior replacements after I already had three unique characters...it kind of became pointless. I think I may have averaged one early game level 2 pickup, and one mid-game "rare" lvl 5 pickup. Recruitment works alright, but it could have been more important.
3) I like the unique characters - they look cool, kick ass, and you have to go out of your way to find them all. Neat. Strategy-wise,....the game would probably be more involved without them. Without the unique chars, the player would actually have to choose who to devote resources to. With the unique characters, it is very obvious. Maybe you could add a difficulty setting without unique characters? It would certainly add to replayability since your team would be different every time.
4) I would suggest you consider making it so that characters have to be rested occasionally, or that characters that go on quests are considered "busy" so that the player has to actually think about who they will use for every lineup. Do you send your A-Team to take out that Orc base or do you send the "other guys?" Do you spread out your best chars or leave them in same unit? It seems like you tried to make this game strategy-lite, and it does work quite well. I played twice and enjoyed it. I personally do not expect to ever play it again, though. Which is a shame, since it is very well done.
Anyway, very nicely done! I hope you make another one!