I have seen many great custom-buildings and cities made with System-X, but I can´t really remember a creation based on that castle, at least not one with major changes. You´ll probably need a saw and glue if you want to drastically change it.
All system-X castles come with large (wall)parts which are very unsuitable for "shape-shifting"...
Other System-X buildings (mostly the early ones) had many more smaller parts which allowed for rebuilding in a much different way. The 3112 Naval Stronghold is an example of such a set, if one has multiples of it - and parts from other System-X sets can further enhance the building-possibilities - then big fortresses can be build. But for the Medieval Times, the best castles for custom-building without having to make changes to the parts themselves, are the Steck system ones from the late 1970s to early 2000s.