The main issue I have found with the werewolf is that it has very, very light damage. Coupled with a very low AC, it doesn't have a lot of survivability. You can make it work, absolutely! But you're going to have trouble with anyone with about half as many levels as you, generally. Large hit point totals will win the day, but its strictly one on one.
All the undead have crit immunity, casting ability in their natural form, many have regeneration and other nifty tricks, and of course, gear. This gear does at least allow a potential to cut through damage reduction.
I play a werewolf now with barbarian levels - I 'had' to take them, it was the only way I could deal some damage, but I've encountered lower level characters I couldn't hurt at all.
The main issue is that in werewolf form, no damage buffs can be applied. Even magic fang or greater magic fang will not work, because werecreatures are -shapeshifters- and not animals, and thus the bonuses cannot be applied. Even cold weapon or anything along those lines, because the shapeshift hides all gear, such as gloves. If you do have all manner of buffs cast upon yourself while wearing gauntlets, these bonuses are lost when you change into your werewolf shape. That's one of the big limitations, really.
If I was going to suggest something, it would be either a damage increase on the combat werecreatures, when in werewolf form - in particular a large boost to their AB, DR piercing (a natural AB or EB) to make them a terrifying combat situation. However - I'd keep the saves low, the AC low, leave them vulnerable but up the offense. They could take the hits, but be able to dish out terrifying damage to offset it.
EDIT- I must admit, with Markov, I've found that I am flat unable to terrorise players, within five levels. Most of my actions as an NPC have been against NPC's. Players are just too powerful to attack for the most part, unless I've been part of a three or four player monster group.