Hinjo didn't seem to be worried, even knowing Xykon was strong enough to overcome the Sapphire Guard as deployed, considering these ancestral spirits to be the real defense on the throne. While he did take down the Sapphire Guard, they did do notable damage to him on the way down (he is still pretty marked up), and it looks like Soon is leading the charge, and he pretty much founded modern Azure City, the Sapphire Guard, and trapped the Snarl, if that doesn't say "Epic Level" or at least "High Level", nothing does, so Xykon's probably in trouble now.
I really doubt it's the "Ghost" template from the MM they have, becoming undead seems kind of wrong for a legion of Paladin-martyrs. Something more akin to the Deathless from the Book of Exalted Deeds sounds (they've brought out the BoVD for this fight, I guess the good guys can pull from the BoED)