I'm with warlord, simply make the "make way" move a little bit easier to get done, and you can just direct attacks.
Characters will rarely ever be killed by rank and file, you need other characters to counter them.
Champions can still be special, in fact you could even make champions more special by making them low level heroes (2 wounds, maybe a better weapon, etc.). They'd be dedicated to assisting the unit in battle against tough things.
For example: state troop Champs have a GW. That'd be pretty helpful from a 2 attack, 2 wound guy.
Having a hero sub-phase sounds OK, but challenges in general have always been gamey and mostly used to lock down characters.