Seven years later, the debate remains unresolved.
I ended up here searching the internet for opinions to this very question.
Have you ever seen the OgreBattle and TacticsOgre series?
TacticsOgre actually comes very close to Final Fantasy Tactics in gameplay and story. It opts for a 10 person party cap, with the game featuring nearly 20 recruitable unique characters and custom party members with class trees. And permadeath for all party members.
While OgreBattle plays like Nathaniel3W's game. You can field 10 squads, each up to 5 members. At that level, individual units become more like equipment than characters, but over the campaign I was always attached to mine. Again 30 odd uniques and a class tree of a couple dozen unit types for the normals.
To prevent micromanaging issues of 50 troops in the field, you just gave objective orders to a squad and it performed the action on its own without further player input. Go take that city? The unit decides, based on its units, which terrain type will offer it the fastest route to the city (plains, forests, hills, snow, flight). Attack that unit? Again the unit pathfinds its way to the target and engages on its own.
When two squads engage, the fight plays out as a classic J-RPG combat. They're set on opposite sides and take turns using predetermined movesets based on unit type and squad formation. Rather than fighting to the death, each squad uses up a set number of actions, then a winning squad is determined and the loser is forced to retreat a short distance backwards when you return to the area map.
Specifically, I'm leaning towards the larger army style game and larger battlefield tactics. Though I'm keenly interested in just how far player interest can be stretched across multiple characters.