hi u can increase party size by winning battles and getting renown, and also from increasing charisma, and btw the smaller odds u have of winning the battle means more renown for u, and u get pretty good renown when the king asks u to fight beside him.
Well if you like massive army's like me ingame you could always hack the game abit.. Then use a battle resizer program for the game.. This link will tell you how to edit up the game files to give insanly increased army sizes..
I commonly set battle sizes to 150 - 200 troops on the battle field at any one time.. Much higher a setting would crash the game on my current computer.. Great fun when you happen to have your tactic skill maxed out as well.. I tend to field 90 units to my enemys 45 at any one time..