I used Gandalf to hit him in the staging area which I assume is OK as it just says an enemy 'in play'? Then I did have to engage him to let him impale himself on the gondor spear.
About the deck size, I didn't think it really mattered for casual play?
Yup! Totally fine. I did that on one of my failed attempts. I had two sneak attacks and Gandalf in hand ready to go. Then when I turned over the bad guy cards during questing I got hit with two "1 point of damage on all exhausted character" treacheries. Wipe soon followed...