You're both correct, I think you're just misunderstanding each other's points.
For powers/spells with the Weapon keyword, you add up your prof. bonus (provided you are proficient with the weapon).
For powers with the Implement keyword, it's just an (as you suggested) oversized implement.
That being said, I also played the Swordmage on a local event this past weekend and all i have to say is that i liked it alot (and the people on the table -maybe with the exception of the DM- liked it alot as well).
I just felt it doesn't deal much damage compared to other defenders, and it kinda feels like it's tending towards the controller (much like the paladin seems to be leaning towards the leader).
I loved the Dimensional Warp (minor action!), as well as the Aegis of Shielding (the DM checked my sheet everytime i used it cuz he couldn't believe it).
Also, there's one minor trick that doesn't seem to be posted here that the Swordmage can use (a class feature), I can't remember the name now, but he can sorta manipulate his sword at distance and bring it to his hand (IIRC, from up to 3 squares).