You need to lure him into the last castle, but before that, you need to destroy all the dragon nests (the sooner, the better). Giving all the dwarf units for phoenixes is pointless, as it makes the game much easier (almost with minimal losses). And, of course, your hero should have leadership with empathy.
Thank you, I'll try that. And what about the castle? Which castle is considered the last one? I've already lured him there, but he still somehow resurrects with an incredible army, and it all starts over again. I'm already tired of replaying this mission.