Awesome! Well put together battle report, there, and you kind of sound like Jean Claude Van Damme ^^
You should have consulted us on the list building process! ^^ A dreadquake is not really worth it at this low points level - as you found out, the risk is too great. Even if the Daemonsmith had been close, it might’ve still missed or just failed to really do anything.
As @Zoddtheimmortal says, it’s rare to see a Castellan in a list, the reason being, he’s really not that good. A Sorcerer-Prophet should be our general, that’s just how it is. On a Bull or a Lamassu, but he also has merit inside a unit of Infernal Guard, propping them up with Daemonic Vessel.
Ashen Banner is good, but is of course wasted points when your opponent has 0(!) shooting ^^ The Infernal Guard champion is a prime place to place the Hellshard, to suicide explode those pesky enemy glass cannon characters!
Your detachment is too big (max half of the parent unit), and it cannot have any command models whatsoever, just so you know.
Your cutthroat unit is chef’s kiss perfect - minimum size and no command, as it should be. Get another one of those, and don’t take them for their shooting (although it often surprises in terms of effectivenes). They’re there to die, slowing down the enemy while they’re at it.
I wouldn’t bother with the Daemonsmith - taking a Prophet will get you a stronger mage who can also function as Engineer for maybe the first round before he takes to the frontlines.
Iron Daemons are beastly, take one of those if you can (probably not at 1000pts, but maybe…?)
Don’t bother with the K’daai unless you’re just having a goof game (my opinion).
A hobgoblin khan on a wolf is a prime candidate for carrying the ruby ring and popping off some fireballs on enemy chaff units.
Anything else…? Right, consider Black Orcs for most of your core requirement - they really are quite decent. A bigboss on foot with great weapon and trollhide pants in there, you’re good to go.
I’m not yet convinced by wolf riders or sneaky gits, because of their price to value and lack of AP respectively.
People like Elementalism, but I swear by Daemonology, since for our warrior wizard and infantry heavy army, there’s really only one spell you don’t want, and you can just substitute that for a signature spell.
I think that’s all. My daughter is waking up ^^ Keep it up!