I like, nice flavour,
gives a +5 bonus when you or your allies threaten the target, you might want to consider using the same value.
In a way, this spell does the same as Sanctuary (In some situations.), a level 1 cleric spell.
The other use of the spell is like Disguise Self, a level 1 spell as well.
I am a bit doubtful wether the combined effect warrants a level 2, especially since you can't use both at the same time.
I'd make it level 1.
Spell descriptions that can be used on yourself as well as others usually say "Living creature touched" or "Creature toched" under "Target". (And that is target, not targets ;))