I don't understand the logic. What does "from" mean? Does it mean that the "Necropolis" in the Necromancer's starting city is built "from" a "Monastery"? It's built from "stones and wood."
If the Necromancer's city didn't buy troops and instead killed them (like in Heroes 3) and turned them into its own, that would make sense.
And building your own city on the ruins of another city – that seems logical to me too.
But what I don't understand at all is the balance when the Necromancer can permanently destroy an enemy city.

The logic is that in this game, you can't build cities like in Civilization or AoW3. Either you implement the ability to build cities with settlers in a random area of the map (but that's difficult because the maps in Heroes games are dense, and it's not always possible to find a large enough free area. As a result, it can easily lead to an imbalance), or you don't do it at all... In this regard, the Necromancer is good because when rebuilding cities, it doesn't populate them with anyone. It kills the local inhabitants, and their corpses become the inhabitants of the rebuilt city.
At least, that's how I see it