When attempting to recruit Olwen, Fred, if used well enough, can defeat each enemy unit near Olwen's locked cage with ease. After the children are freed, it would be smart to make sure they escape safely. Oltof might make an attempt to attack the children.
As for Leif's units, you may need a unit who can attack from afar when walking through the narrow path. After that path all of the worst is over. Four Sword Armors are in the open space. The archers in the open space are not a problem, as long as you are not in their path. Oltof has no weapon to attack you directly, but he is protected by three Axe Armors and two Wind Mages. If you are able to, you should steal the Wind Tomes.
If the children escape, you will be rewarded in the next chapter.
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The Thieves of Dakia