I know you can get them from razing villages, or by buying them. But what do you do with them?
The point of cattle
mount-and-blademount-and-blade-warband
Related Solutions
If you click on "Reports" on the bottom of the screen while you are on the campaign map, there should also be a button for a report about troop morale.
This will look like this:
There are merchants in the taverns (they travel around so can't say what city you'll fine them in). You can sell them into slavery through them.
Not sure if it's in the original mount and blade, but some of the series has quests to take x number of enemy prisoners for lords.
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Best Answer
Cattle has two main uses. One of which may be more useful than others.
If you purchase some cattle, you can interact with them on the world map. You will be given two options: Butcher or Move the Herd (I don't remember the exact wording, but these are close).
By choosing to butcher the cattle, you will receive meat in your inventory which will provide food for your party until it is consumed, or spoiled. It's not the cheapest way to get food, but it can help if the town has nothing else.
By choosing to move the herd, you can corral them to another city, or to your Marshal's Army, should the Marshal (or Village Elder) ask for cattle. This will increase your reputation with whomever requested the cattle.