[M]: "Counterattack"

This time, the script worked. It's a good map, with a decent battle at the end. The other Castles are insignificant. There's at least one bug. At first, Lorenzo wasn't killed (she didn't want to lose troops without magic). She destroyed the Castle, and he retreated to the Dungeon and then headed towards the Necropolis. She ignored him for now and went to capture the Castle, resupply, and so on. Every turn, until she finally defeated him, she received a large number of Holy Sandals (apparently, he was running around there as much as he could each turn). In short, there were no further money problems.

Added 4 minutes later

It seems that the game tracks whether the hero is actually in the Castle, like if he managed to visit the town before the script that destroys the town is triggered.

I came to the same conclusion, but about ten minutes after capturing the Castle, and I was too lazy to undo and check, and then I simply forgot.

Added 3 minutes later
Is the "non-working" dragon set designed this way?

Added 7 minutes later

Decided to replay, this time with Dark Magic.

Why did you need to replay? There's a mentor near the second Castle. Although, what's the point if the demons destroy the magic?