How to level up. This guide explains how to actually level up the cheat skill in the early access version of the game to get those tasty looting skills.
Now wait a second. How the hell are the peasants going to help me level up my cheating skill? In-game help text mentions caravan raids, but nothing about peasants!
Well, you see, by some irony of fate, you are not attacking the peasants, but saving them. You will need a lot of them (20+). In addition, you will also have to rescue them from a bandit group of marauders, about ten of which you can solo right outside the gate, despite the Holy Rock in the head.
So find yourself some marauders with prisoners (hold the Alt key on the map to see who has wounded (+ W #) and prisoners (+ P #).
Once you find the party, you can go into battle with the prisoners, confirm that they are peasant class prisoners (or, for example, one of the upgrades, the watchman or the Hired guard, although this would be extremely rare). Peasant works, from Kujait to Vlandian, but ideally you want them all to be the same crop because of the way the XP squad works.
Once you save them, we can move on to stage 2, the hardest one. Try to get around 20-40 peasants to absorb the losses.
Boulder Throw!
So now you have your own peasants? What's next? Now it's time to polish XP. You see, a humble peasant is upgraded into a poor soldier T1 "watchman", but he, in turn, is upgraded into one of two options. One of them is what we need to start your fraud training.
So train these peasants! Choose only looters and make sure (unless you auto-resolve) that only peasants get kills to speed up XP (Yes, it works). Fortunately, this is not very dangerous for peasants or looters, as they mostly just throw stones at each other and some come with pitchforks. As long as you're not overwhelmingly outnumbered (try going 1: 1 or less to be safe) this should be pretty easy. If everything starts to turn against you, you can always kill a bunch of marauders yourself.
Your peasants will rise to the level of the sentinels pretty quickly, the watchmen have no ranged attack, so they are a little more dangerous to line up against the marauders, so expect more casualties. As a hint, try upgrading all your troops at once. Because of the way XP troop, the whole unit class shares the XP pool. So don't update them until everyone is ready.
Repeat this process with your guards and upgrade them to hired guards, which is what we want.
Deadly Rifle Squad
Now that you have your hired guards (20+ is ideal, and this can take on groups of marauders over five times their size), it's just a matter of chopping up more battles.
You see, the Mercenary Guards have crossbows that fire blunt bolts. These bolts are not lethal and do not kill the target, but rather kill it. This means that you will have 100% capturing percentage if only these guys kill you, and then you will buy out entire armies for massive XP cheating. Have some fun.
As a final goodbye tip, make sure you are not redeeming units from the world map, you should actually enter the random menu (it looks like a party menu) and then you can redeem everything. If you redeem the fast option from the world map, you will only get XP for one prisoner, even if you discard them all.
XP does not appear to be tied to the value of gold per prisoner.