How many factions are there?

But why was the Swamp so weak? It was just a Castle... Or am I missing something?

Honestly, it was. I remember it well; no one wanted to risk playing as it against Dungeon or Necropolis, and even... well, against anyone.
It has no decent magic, only one decent ranged unit (Blinding), the Hydra is slow, you can't rely on Gorgons and Wyverns, and the Castle requires a lot of wood... It's especially hard to capture Castles. The two flying units (Snakes and Wyverns) fly over the wall, where a skilled opponent shreds them, and then shoots the remaining part from behind the wall – it was incredibly annoying. The Hydra never lived up to its potential. Don't even mention the "Teleport" spell...

In general, it's right that Hydras shouldn't be Tier 7 units. And Wyverns, Wyverns were given to the Orcs. And Paokai was clearly copied from the Rukh birds!

In short, it's depressing; I want a normal, playable, and interesting Swamp... waiting for Heroes 6, and another 4 years... I don't want to. I hope the developers will change their minds. Maybe they'll make a new expansion and start a new storyline...