Well, I'm pretty sure goblins are the way to go with enemies, so now onto the next problem:
I need 2 kings, 2 queens, 4 rooks, 4 bishops, 4 knights, and 16 pawns. I imagine I would do each piece a little differently, though still easily distinguishable as their reflective position, as I feel if each piece were the same it would seem a little dull.
For the dwarves:
The king would be a battle-hardened dwarf with a heavy weapon and some sort or majestic armor - not really open for debate, though taking suggestions
The queen would be a well dressed noble, a dress, and with some sort of crown - not too much else can be said
For the rooks I think I may go with the heavy armored dwarf as I feel some sort of siege engine would be a little out of place (though the ideas are great, they may be a little too big :/ ) - any suggestions are welcome!
The bishops, not too sure about this! I was thinking some sort of dwarf in knight's Templar-esque armor - anything you can think of!
No horses for the knights, I have decided that much, as it would not fit and it would end up looking terrible! I was thinking crossbows might work... - please, suggestions for this?
For pawns, a generic dwarf, possibly with any basic weapon (sword, spear, axe) as long as the knights can be sufficiently different from them! - Yup, anything else anyone can think of will be taken to heart!
For the goblins:
Now this is the tough part, I will allow some suggestions as I work on some other ideas, and will edit this part later!