I can approve that it works on Impossible difficulty as well, in a no-loss run. i usually used a stack of Knights (+3 init at start of combat from skill), in order to finish off all remaining enemies, but of course, there were some insane fights as well (the defense dragon; dang, that was an epic 80+ turns battle where I regenerated mana and tried to survive like crazy; would have lost with pretty much any other unit than Knights). Last fight was pretty fast, but required some strategy in order to get my Knighs back from Hypnosis.
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