Negative on the morale idea--I was pretty far along before the patch and had no problems hitting via spells. Then after the patch NOTHING in my army could hit with a spell (and yes they had good morale). On a whim, started a new game, went right in and presto can hit stuff again. No biggie, just a litte lost time and it seems most saved games in most games are busted by patches anyway. 
However, I'm back up to the same spot tech/magic wise (more or less), but now have a different bug with the patch. When casting Hurricane (minor Air Elemental - summoned critter) the game crashes to desktop everytime. As soon as my little minnion dude raises his arms...POOF, CTD with no error report.
The game is a blast, I just can't wait until they get all the little bugs worked out.