The Khazad are my guilty pleasure civ in FFH; they were the first civ I ever played and they're the civ I go to whenever I just feel the need to turtle and stomp(tm). The Khazad's only meaningful disadvantages are their inability to plumb the depths of the arcane (good fun if you don't value your eyebrows) and their generally slow expansion (you don't HAVE to have overflowing vaults in the same way you don't HAVE to build warrens as the Clan).
However, the Khazad are well equipped to spring forth in the middle and late game, becoming juggernauts of industry, commerce and inebriated violence. While everyone agrees that Dwarven Druids are carved from solid blocks of Awesome, I rarely have meaningful opposition by the time I'm playing with T4 units. Whenever I usher in an enlightened age of bearded dominion I do so with axemen/champions, trebuchets and enchantment adepts.
Here's the thing: despite many fine and clever tweaks by Kael and Co., melee units still rock the casbah; metal promotions, march, city raider and the fact that the melee branch of the tech tree contains so many other tasty fruits have all made the ax the preferred weapon for Erebusian domination. The Khazad may have no meaningful recon or archery units but that's okay because they still have the only unit-type you need. Your heavily armed infantry can go toe-to-toe with anything wandering around outside a city and, as the Khazad, you should have no trouble training plenty of 'em on short notice.
Furthermore, trebuchets are to engines of war what zombies are to civilians in a Romero film: devastating and best in large numbers. Trebuchets can and will crush an enemy stack in short order. Whether you're cracking a city or countering an invading Stack-Of-Doom, throwing five trebuchets at the problem will leave you with one stack of crippled enemies and (statistically speaking) four or more trebuchets. Then your dwarves jump in with mops and you end up with a lot of promoted mop-wielders and dead enemies. Let me impress upon you that trebuchets are an oft overlooked but marvelous unit: they are early in the tech tree, have very good stats by themselves (6 attack at a time when your bronze-wielding axmen have a strength of 5 is very nice), bombard very well, cause collateral damage like a doviello in an antique store, and have an 80% withdraw rate. While they are slow, with proper use, they are unstoppable and if you wanted to perform lightning raids on your enemy what the heck are you doing play Khazad <points to hippus>?
So you get a stack of melee units with march, a half-dozen trebuchets and one or two adepts hauling a wagon of siege-engine components and duct tape. You throw this stack at a rival civilization and it will slowly but methodically destroy all of their cities... like a molasses tsunami. You can do this early, you can do this often (courtesy of your crazy-go-nuts production) and all the proceeds of your conquest go straight into Khazak Mutual Funds: paying dividends in the form of hammers and happy since the Age of Magic. Invest today and get a free* mini-shrine to Kilmorph.
*Free after you pay a nominal charge.
Imagine if every Sidar city benefited from God King, giving each one +50% production? We'd scream foul. We'd run, en masse, to the balance thread and whine like there's no tomorrow. But the Khazad pretty much get that early-to-mid game. Once you have the coin, every new city comes with an overflowing vault; the single most potent non-wonder in the game. An overflowing vault plus a two-metal dwarven smithy gets you +80% production... that plus one or two civic-born bonuses and you are basically getting two hammers for the price of one; which is a hard act for rival civs to follow. The Khazad go in for Quality over Quantity approach to cities (until the late game, then they can expand like a tar demon in a buffet), so they play similar to the Kuriotates. You'll find yourself with a handful of cities producing everything and, unlike the Kuriotates, they don't need some sissy third ring to pull it off.
One last thing, I think Runes of Kilmorph and Khazad go well together like CEOs and slush funds. Aside from the obvious "mo' money" aspect, you get Arete, Soldiers of Kilmorph (or as I call them, Hammer Piñatas) and Bambur. You are going to have mines littering the countryside so Arete is the logical choice for feeding your military-industrial complex. Using Kilmorph's Piñatas, you can give a fledgling city a hammer infusion like no other. And, despite what others say, Bambur is in no way weak; he has the benefits of timing and synergy on his side. He shows up early enough for a strength 7+ (metal + heroic atk/def) melee unit to really help; I use him to crack that one stubborn defender that refuses to yield to my trebuchets' gentle reminder that their city has been slated for demolition. And getting an early Enchantment 1 caster makes a HUGE difference for a melee-and-machinery based military. Suddenly all your units have a +20% to combat: that's like Kandros somehow having the Aggressive trait twice! And Bambur allows you to send off that genocide stack (ax + trebs + patience = no more neighbors) that much earlier.
I may have to work up a Khazad AAR, like I did for the
Bannor and the
Kuriotates. I will not have my bearded battle buddies slandered so. Strike the EARTH!