The rivers aren't forking off into the swamp, they are draining out from the swamp. So the waterfall is made up of some swamp run off.

I agree that having the swamp on a number of levels is a bit odd. I might remove the arm of the river that joins above the waterfall to fix that a little, and remove some of the higher up elements of the swamp.

Anyway, the mountains are done. Here's the current draft.
Island4.jpg

Not much to do now:
1. Small details on plains and around the water's edge.
2. Town and location icons.