I have a similar problem, people are suggesting throwing spells at them from a distance, but my spells aren't that good yet. Besides if the buggers get too close to the town you don't have a chance. The combat isn't properly turn-based either, so you take damage much faster than you can dish it out. I've done the crypt, serpent temple and all the other stuff I can do to get experience the other side of town but have only got to level 4 spells. I think these things are way over the top, especially at this stage in the game. I can only think of messing about until I have enough experience and/or money to up my spell levels a bit.
I think it's a bitch that any spells such as armour that you have cast on yourself disappear as soon as you go into town, but spells that are cast on you such as poison, don't.
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