Try this:
Make a mod subfolder in your main M2TW directory, ie. 'Corbetmod'.
Make a Corbetmod.bat (which will run medieval2.exe @Corbetmod.cfg ) in the same directory.
Make a Corbetmod.cfg in the same directory.
This .cfg should at least contain the following:
Code:
[features]
mod = Corbetmod
[io]
file_first = true
Put descr_sm_factions in the data folder of Corbetmod. Take care that the other needed files are also in that mod subfolder (like the map files, etc.). Edit your descr_sm_factions and change the colours of England.
Check that map.rmw is deleted before you run the game (it will create a new one each time you start a new campaign). Double-click on the Corbetmod.bat to run the mod.
Regarding the 'London' issue: try deleting map.rmw and the strings.bin file. Then start a new campaign.