Why not replace Steadfast with the outnumbering mechanic? Give models Unit Strength again, but this time give the +1 CR for having more Unit Strength, and another +1 for Double, Triple, and so on. Maybe up to +4 or +5. We already have numerous combat resolution modifiers, and the old "Outnumbering - +1, no matter how big the difference is" always seemed a little silly. With the Outnumbering and Ranks bonuses, a big unit can take a lot more damage before you start to beat it in combat - and on the other hand, when you're beating it, you're actually winning, and it's liable to run rather than, "Oh, I know we lost half the unit without killing a single man, but the rest of us can hold here no problem."
As for magic, I wouldn't mind both a refocusing of the lores and a general reduction in damage output. When Empire infantry are only effective "when properly buffed," I feel like I'm playing the wrong game. Or at least fielding the wrong units. For that matter, I wouldn't mind seeing some toned-down units, too.
As for a not-fixing-a-problem change, I would like to see some more leadership-based actions. For example, charging units gain Strike First - but only if they pass a Leadership test, representing the unit managing a coherent, coordinated attack. Archers shooting at not-the-closest-viable-enemy only if they pass Leadership, as the unit's sergeant grasps the major battle plan instead of merely the unit's self-preservation instinct. Some units could have a rule enabling them to negate the bonuses of cavalry and chariot charges - if they pass a Leadership test. And so on - you get the idea. We already have a little bit of this with the free-reform-with-a-musician-and-leadership-test and marching-near-enemies - I think it would be cool to expand upon it. Naturally, unit Leadership would have to be a bit more of a factor in costs - but it would reward high-leadership armies and, ideally, make them more viable even without particularly high weapon skills or physical stats.