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I run csm with daemon allies.
For my warlord trait I rolled the one where the warlord and d3 units from your army gain infiltrate (FINNALY...NEVER GOT IT BEFORE!!).
after he set up I went to place my infiltrators and the guy threw a royal fit when I went to place my bloodletters and blood thirster. "you cant do that their not part of your army". I told him their battle brothers and allies can benefit from psychic powers and warlord trait.
I personally think he knew my bloodletters and thirster were going to tear his troops apart in the first turn...so that's why he was upset. But just to be safe I figured the experts here could lend a hand.

Your Bloodthirster isn't infantry so that's illegal anyway.

Army is a poorly defined term, it is used both to refer to a whole force including allies as well as forces selected from a single codex and at times I believe individual detachments.

You need to determine with your opponent how you feel rules that refer to your "army" should be handled.

edit: Also, if models infiltrate they can't launch an assault during the first player turn of the game. i.e. If you were going first, your infiltrators could not legally assault him during turn 1.

The wording of Allies of Convenience implies that Battle Brothers can benefit from the Warlord Trait.

The only time "Army" is "poorly defined" is when dealing with older codexes that state "models in your army". In the newer codexes things that apply only to the specific codex specifically state that.

Happyjew mentioned that the Allies of Convenience imply that Battle Brothers CAN benefit from their allied Warlord traits. I concur.
I also found something that is a bit more explicit. BRBp109: "Your army can include one allied detachment for each primary detachment in your army." This clearly states that all detachments (both primary and allied) are part of your army. So yes, you can infiltrate your Bloodletters. Woot.

Army is not a poorly defined term. What you bring to the table is the army, allies included. Warlord traits may affect an allied battle brother. Says so in the rulebook.

That said, you can't infiltrate a Bloodthirster; it's not an Infantry unit.