You can't just do nothing...Here is the solution for everyone: (I Finally figured it out)
Go into the scenario menu
_click on the player properties option
_click the Player's tab
-> Set the appropriate player to a computer player
_then click on the forces tab
-> Ensure that 'Custom Forces' and 'Fixed player settings' is ticked.
Go into the trigger editor
_click on melee initialisation
->delete the 'Run AI scripts' function.
The result is an AI that obeys your orders, never retreats and casts spells.
BEAWARE that spells will be cast given that certain conditions are met. For example, I gave a caster the 'Hurl Bolder' ability. The caster will only cast the spell when he is directly attacked by an enemy unit. It would be great if somebody could list what spells are triggered under what conditions. e.g:
_All damage spells are triggered when the unit is under attack.
_AOE spells are triggered when there are a few enemy units.
Something like the above but without my vagueness.