How does the combat bonus applies? If for example the first player has +4, should the bonus be applied to one or all his military units strength? Is this bonus counting towards the number of wounds a unit can suffer in battle?

It doesn't interact with the units. The bonus is considered at the end of the fight, after the units have fought. The remaining value of the units is totaled up, and added to the combat bonus.

Yes, this means that someone can win a fight if they field no units (or have none left after fighting) if they have enough of a bonus. Don't attack a city without some kind of advantage.