I used tons of horse archers in my Byzantine game, and my retraining mechanic was to use high xp units to top off low xp units, then retrain only the high ones. I'd never merge two into one, but say I had a 4 xp unit at 58 men, I might use that to top off 3 units of 45 men who only had 1-2 xp, then retrain the now-depleted 4 xp unit. The majority of my battles with an all horse archer army resulted in a large number of my units down anywhere from 1 to 5 men due to friendly fire.