I didn't find it especially useful, but in my last battle the AI did focus fire on them, so it might be good after all.

Their number equals half the bone dragons' leadership, and I only ever got skeletons, no archers.

Having eaten archers, I got skeleton archers in return. I don't think it's a coincidence.

Most likely, it makes Skelly Archers from units with the 'Archer' ability (Archers, Elves, Hunters, Skeleton Archers).