Minotaurs are truly epic :3
Which brings me nicely to the HoMM3 Dungeon town. I find Troglodytes to be truly epic in numbers and stats (considering how many you get per hero, especially the Trog Specialist hero). Upgrading them on the first turn makes them very powerful, epsecially when you split them into 1 unit stacks in your hero's ranks.
Harpies are okay, 1-4 damage is nice when Bless is used on them, but horrid when Curse is used. Evil Eyes and Medusae are nasty when they grow in numbers. When it comes to Minotaurs or Manticores, a choice must be made early on in the game depending on what resources you get. If I have the option, though, I would go for Minotaurs first, as they are very nasty in high numbers.
Dragons do not need to be upgraded (primarily if you have Ressurect), but if you're dealing with a spell-spammer enemy, the upgrade is your best friend.