Great stuff!
One thing - I'd say that heroes really are the heart of the game. Even if you try minor heroes like captains, rather than the big badasses, you'll find their ability to act out of turn, their Courage and their resilience are important. The hero's higher Courage, along with banners and spears/pikes, encourages you to group your troops into "units" without forcing that straightjacket on the game (good bottom-up design)
Big Damn Heroes are a lot of fun to play. If you look closely at the sourcebooks, you'll notice that named minor heroes get a special rule and Might/Will/Fate bonuses compared to captains, and usually for only five points extra - consider that if you want to personalise your forces. The game is also very god if you play heroes vs heroes or heroes vs small force of enemies - the Fall of the Necromancer sourcebook is good for small but powerful battles. Scouring of the Shire and Battle Companies are good for smaller low-power games.
The core mechanic can be quite bland otherwise as you say - it's basically "gang up on the other guy". It can often lead to dogpiles, where every mini on the board is fighting in a massive melee in the middle.
You may consider dropping the Defence scores a point to keep things flowing (certainly Dwarfs are pushing the limit with their defence scores, especially in small games), and objective-based scenarios can break up the "one big fight" effect. The Hobbit SBG also introduced rules for specific weapons and special attack types for monstrous creatures. Generally though, the RotK rulebook is pretty solid.
The big thing that limits the game to Middle-Earth is magic - consider using Mordheim magic as a template. Warhammer Fantasy stats are easily converted. Missile fire is deliberately weak in LotR, to stop Aragorn being shot to ribbons every game, and that shows in the likes of Legends of the Old West, where it often makes more sense to gang up and beat someone to death rather than have a shootour