bobchik
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I still think phoenixes for the Elves are a good idea. Firstly, they are a symbol of life. Secondly, in the fourth game, they looked good there (much better than some obscure dragons). And regarding the difficulty of creating a beautiful and dangerous bird, while also making it unique... Well, it can be done. We should expect the best possible implementation in any case, not the worst. Otherwise, dragons can be easily messed up too (ahem, the Dragons in Heroes 4, ahem).
Although I voted for option 3, I still think that the Sylvan faction should specialize more in diversions rather than tanking in direct attacks.
By the way, in Heroes VI, phoenixes were dangerous due to their aura, which prevents healing the dead. That's a pretty good bonus.