[thejeff]

You can see how it calculates by running the combat with debug on.

Near as I can tell, it prioritizes the scripted spell for that slot in the script. If he can cast that round, but can't cast that spell he'll cast something else and move on to the next thing in the script. If he can't cast at all, say he's surrounded by fliers and takes a swing at them instead or an earlier spell knocked him unconscious, when he next can cast he'll pick up he left off in the script.
Which spells you script have no effect on what mages cast after the script runs out.

You can script the short range spells, but it's tricky. You have to get them in range first and then keep them alive long enough. When in combat they're likely to cast those spells anyway, so it's hard to be sure.