I just hit lvl 20 with one character, so take what i say with a grain of salt...

Vaan uses big, two handed weapons like spears, katanas, and ninja swords. I killed the werewolves in the Giza Plains early on and picked up a kotetsu that's been working very nicely. Yay quickening chains! He's set with some basic black and white magics for range and healing, as well. Add in some light armor, and he's one fast, deadly little bugger.

Basch and Penelo are identically equipped with sword, shield, and heavy armor. Again, just basic black and white magic here.

Fran sticks with bows and Balthier with guns. Fran uses a lot of staus effect magic, while Balthier is the thief/tecknician. Great for enemies that are across a divide or for fliers...

Ashe is the only primary mage. Heavy use of both black and white magic, with a healthy dose of Arcane on the side. Mystic armor, and she uses a good sturdy rod. Bonus MP ++.

Generally, Vaan goes in first, hits once hard, then runs away (not fleeing, just moving out of the enemies' range). He leads the enemy back into the heavy hitters, who beat on it repeatedly while it still chases Vaan. Makes most small fights easy enough. For Bosses and Marks, i've put a lot of LP into getting all 3 quickenings for each character. Haven't come across a beasty yet that can survive a 16 hit quickening chain...

By the way, my location in the game? I just got to the Raithwall Tome and killed Garuda (Yay quickening chains ++).

I've done a LOT of leveling up and LP farming...