First Game Over - Questions/Comments Please Help!

It does not matter where you are attacking FROM, just what terrain the defender is on.

Knights have an attack of 4, Impis a defense of 2, that's why they were slaughtered.
 
Knights have one, and only one, purpose: To kill stuff real good. Unless the opponent is far more advanced, or they're Japanese (samurai), your knights will make short work of them. That's why they're an optional tech that early. That's why they take both iron and horses. And that's why samurai are insanely good UUs.
 
Regarding money. It's real nice to have a lot of gold in reserve so you can upgrade your 100 tanks to modern armor in one turn. The AI tends not to upgrade units so you can kick some butt if you save up.
 
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