Ch3 boss on hard mode. I had no problems with any normal mode story battles nor ch1~2 on hard.
It probably isn't too good to use allies as you progress. It seems they don't get any squad support or research bonuses from you, so they have low stats, at least everyone I've ever tried using does. Unless it's based on that players own set up or something.
Ch3 boss on hard I feel will be the stopping point for a lot of free players unless you're prepared ahead of time. It has 5 Lv59 enemies, 3 cavalry units and 2 mages. 1 cavalry with a whopping 26k hp and the rest with 14~16k. Various status effects like sleep, silence and freeze as well as damage reduction/own damage up party buff. You will be stuck with Lv45 units being your highest because the items to evolve and break that level cap don't drop until the next chapter, Ch4 hard and above.