It is a viable army, but it has some fundamental problems when compared to a similar Dwarf/GC list which you can make. Who is your champion? King of the Dead I guess not and Captain of MT is not very good otherwise.
Barely anyone uses Shamans competitively so in terms of them charging you it would give you a slight edge, but the truth is that Warriors of the Dead are not as good as supported Khazad Guards when fighting Morannon Orcs, look at these stats:
In terms of killing ability:
- Supported AotD wins & kills a Morannon 38% of the time (50% to win and 75% to kill after that)
- Supported KG wins & kills a Morannon 34% of the time (61% to win and 56% to kill)
=> That means that AotD's killing ability is equal to 1.11 : 1 in comparison to KG.
BUT:
- AotD's cost of x compared to the KG's cost of y is equivalent to 1.36:1, therefore it is not as efficient as the supported KG.
That plus the fact that King of the Dead is probably the most overpriced character in the game - I wish there were captains for 50 points or so available or if the King had F5 with 2 attacks at least.
So if you compare AotD to KG and work out that you can get a very similar list of Dwarf/Grey Company to this one, except that you don't have to take the King, you can come up with the following list:
Saruman the White
Dwarf Captain
14 Khazad Guards
7 Dwarves with Shields
4 Rangers of the North on Horses
16 Rangers of Arnor with Spears
43 models. I'm sure you could drop 1 Dwarf to upgrade 4 others to KG, but the reason for shieldmen is that they can shield and gain survavibility through that.
And that list finished 2nd in the 2009 GT. In comparison it has the same number of shots, 1 more Might, 1 more model and just 6 less high quality warriors, but then again I would say that Saruman is a bit better than King of the Dead and should cover that difference
So in the end: yes it is a viable combo, but there are better options that have very similar structure.