How you position your troops and which to deploy is entirely up to you. In fact, while you may think you can just plop your troops down anywhere, you soon learn that deployment can have a huge impact on the battle. Typically in a battle you must simply destroy or force all enemy units to retreat. Units are affected by morale. When a unit breaks you no longer control it, it will run and eventually rally and regroup so you can issue new orders.
Units can also surrender.
This means they break and run and try to escape the map. If they do, they live to fight another day, but they are lost to you for that battle. In addition to ranged weapons like crossbows and bows you have short range fighters and mages. Mages are the most powerful fighters, but are rare. They can cast magic spells to help and harm.