The screencap from the Ace Duel doesn't help much. The target player picks a NON-OFFICER unit from their Lance, and then an OPFOR unit of the same weight class is generated to fight them.
Ace Duels are 1-on-1, but there is a 1-in-10 chance that the OPFOR Ace's lancemates will jump the player. Lancemates are always lighter than the Ace. The OPFOR Ace's skills' are fixed (ie, it'll always be X/X no matter the weight class), but SPAs and Edges are ALWAYS present on an OPFOR Ace.
There is a percentage chance that a custom Mech will be pulled if the player's mech is a custom unit. The chance is equal to the number of custom Mechs in the target player's Lance (ie, have 3 custom Mechs, there's a 75% chance of the OPFOR being custom; in MM, that pulls from any Mechs tagged as custom in MML, in the case of this campaign, I'd generate a custom Mech for the OPFOR scaled to how min-maxed your Lance's custom Mechs are).
Finally, there is no Contract Breach if you refuse an Ace Duel. One of three things can happen if you refuse (I'm unsure of the chances of each of these happening; I've never refused a duel):
1) Nothing
2) The Ace shows up as OPFOR in a later Scenario with the Blood Stalker SPA (target: you)
3) Your Lance can be the defender in an "AMBUSH!" Special Mission. Guess who it is.