Level 1-5
Go across the bridge on the side by the weapon and armorsmith. At the end of the bridge, turn right and enter the graveyard. Training at these zombies to level 5 will get you a decent amount of gold to buy better weapons and armor at the castle.

Try to kill Zombie Lords as often as possible. They have potential to drop high-level gear, including horse mounts. I received TWO White Horse mounts from Zombie Lords.

NOTE: At this point, you can wander around and try to kill the level 8 bats and scorpions, which are more xp and gold. However, they are trickly to kill at lower levels and you could stay at zombies and kill Zombie Lords until level 10.

Level 10-15

Find Elven Witches and Gargoyles. Kill all nearby mobs around the castle (Bats, scorpions, rat slaves, etc). Fast xp and gold drops.

Level 15-25
Giants. Seriously. You will get amazing drops. That's all I'm going to say. Get to them before they get nerfed.

25+

Well, I'm currently level 24, so I'm not too sure about this one. I just got a boat so I'll venture out further and see what I dig up. I'll post an updated guide for intermediate levels.