Thank you and welcome to the forums!
1) When towns get raided by barbarians is the only outcome eventual destruction. I think it would be awesome if this group of barbarians tool over the town, then some of the fleeing townsfolk could give you a contract to get it back for them.
Bandits (which I assume you mean by barbarians) are out to raid villages, take any valuables, supplies and the odd villager, and then leave. Their aim is neither to destroy a village and rob themselves off their future income, nor to take over a village and take up farming themselves. Only the Greater Evil will completely burn villages and cities to the ground. Even then, a certain faction when being the Greater Evil will make villages and cities their own. I don’t want to spoil anything, though (:
2) If you lose a battle or if a brother falls is all the equipment on him lost unless you pick it up again? And if you.lose a battle will you loose all the equipment your men wore?
If a Battle Brother falls, you can pick up his equipment after the battle, assuming you win. You can also pick up part of his equipment (not armor) during battle and then get the hell out of there with your surviving men. If you lose a battle, all the equipment dropped is lost, as is the game potentially if you get wiped out completely.