If your looking for a good all around option for 500pts
I'd go for
A Mounted Noble or a Sorceress (cheaper as there are no mounted hero figures)
A box of warriors with shields made up as crossbowmen these guys are as effective as the spearmen in close combat and can shoot effectively as well.
5 Dark riders with crossbows to act as flanking troops being fast cavlry they are highly moble can move upto 18" and still shoot
1 chariot in a small game these are really hard to stop and are highly destructive espcially when used in conjunction with a flanking charge from the Dark Rider unit or to support a relentless advance from your warriors.
To your questions
A box of warriors is a good start these guys are easy to assemble and easy to paint on mass fairly quickly. One tip is to paint the shields still on the sprues and glue them onto the finished warriors, if you make crossbow armed warriors do the same with the quiver - it makes life a lot easier that way.
Faces my favorite way is to use a base of vomit brown with fleshwash and a bleached bone highlight on the regular guys. It may sound a bit odd but is very effective. For the characters and models with a lot of flesh like Witch Elves you can highlight this further with some thinned down Elf Flesh to get a really palid look.
The Dark Elves benefit from being mainly dark colours with a small amount of a highlight colour Red Gore or Hawk Tuquoise make nice highlight colours for the cloaks and armour plates if you don't want to use a metal finish. I use Bolt Gun Metal as a base for the chainmail areas and weapons. This keeps the models nice and dark and allows you to really emphasis the details such as flesh hooks and weapon edges.
I'd also suggest having a look at the tactics article on this site and on
druchii.netHappy Gaming
Kel