Part of me is wondering if it is just my imigination because I can not find it any where. But the movie is kind of thumbelina and it's a bugs life put together. I can't find it at imbd and no it is not ants or something like that. It is also no quest for camelot kind of movie.

That sounds like an Italian movie for which I have been looking too.
It has an attack on an anthill protected by "anti aircraft" shielding made of wood netting, and the air force consists of dragonflies. One of the main characters was "Commandante Trin Trin"

If that sounds familiar then you are probably looking for "Putiferio va alla guerra" of 1968
Also known as "The Perils of Problemina" and as "The Magic Bird".
http://www.imdb.com/title/tt0063475/