apparently there is a dispatch limit to 10 groups only....
and I think I read somewhere that you can make 29 different groups total... wtf is the point of allowing 29 groups total if you can only dispatch 10???? Later in the game can i dispatch more or something?
The dispatch limit always stays at 10, but the max number of units you can actually create is indeed 29. Depending on how you play, though, making more than 10 can be reasonable. You could cycle between units that are more suited for the particular map, or have a special unit for liberating trickier morale values (maintaining halfway lawful units is a challenge...). Via training, you can keep most of your units up to the same level, too. Since playing with many units would generally lead to weaker/underleveled characters, you could also just play without caring as much about the general well-being of your units. Send weak units out, and when the enemy wipes them out, dispatch more to fill in the ranks. You'd end up using a lot more soldiers and undead this way. One of the great things about Ogre Battle 64 is you can experiment with all sorts of playstyles.
The point of 29 units and only 10 dispatchable would be so that you don't spend all your time over powering your main core units, though I still do anyway. It's so you can have different units suited for different things as the guy above me said. Usually I have units that concentrate on certain movement styles, examples being forest units and flying units. This gives me chances to have units move faster in different terrain (or flying everywhere) so that it makes it easier for me to get places.
Another reason for the limit would be to prevent you from over whelming the enemies. If you pay attention, there's usually no more than 10 enemy units (if ever) until later in the game, and then they're still reasonably handleable by 10 of your units.
I am not stalking you! Just merely... "investigating" you at every moment :)
I used to create more then 10 units and I'd choose between various units as to which to 'sit out' an area, but I got tired of that. Now I only make 10 units and when I get too many characters, I just cut 'em.