Welcome, hope you like the game, and hope we can help!
I don't play with BC rules, so I can't help you there. The most recent incarnation of the SBG uses warbands, ie: 1 hero per 12 warriors. So you'll need more heroes. The best bang-for-buck in that department is Durburz, he has decent stats and can keep your army together better than most. Another "must-have" for goblins is a shaman...turning on Fury means your little imps will have no trouble charging those terrifying elves, and sometimes they'll survive a hit.
It sounds like you'll want to play with wargs as well. The warg chief is a decent leader so long as you don't send him against other heroes. A good ally for wargs is Druzhag, since he can power them up. The only problem with Druzhag is he's slow (like all goblins) and wargs are fast, so deployment at the beginning of the game is pretty important. So long as we're talking about beasts, I find bats really useful, even better than wargs under Druzhag's spell, and as a great team with trolls to take down tough heroes. My son also like the poison shaman dude (I can't recall his name, I don't have my books handy) because he can upgrade spiders to Venombacks, which have done quite a number on my Gondor forces
If you're not into beasts, there are other goblin troops you might be interested in. Prowlers are very useful for their special rule and throwing weapons, and blackshields cut your casualty rate in half against most good armies and elvish shooting.
As for trolls, I like them for the look and theme and the occasional smash-fest, but sometimes they're just arrow magnets.
As for the Balrog...maybe the new warband rules have changed things, since the scenarios are more objective-based, but if you just play straight-up battles you likely won't have any opponents before too long. It's not that he can't be killed, it's that doing so is a long boring process. You might want to get more familiar with the game before committing to such an expensive model.