Demon invasion.

then the junk that the Genie gives out will be passed off as a Dwarf set (not working as a set, only as 4 separate artifacts). But here, the mentor works normally; it's more profitable to invest money in heroes and mentors, as they can defeat many on their own.

In general, I wouldn't have passed it without a mentor. They have armies that are many times larger, and the heroes are not weak; if you fight one in a fair fight, you'll have almost no troops left, and you need to have a dozen or more of these fair fights.