1. So are they duty bound to provide all sites over a square footage for consideration, or can they just select whatever they want? (i.e. is the land assessment a matter of process or choice)?
Its normally choice, although people normally take the opportunity as obviously allocated land is worth probably double what unallocated land is worth - Bizarrely we have three allocated sites in our village but the owners of two of them are doing fuck all to obtain planning permission, but that might just be down to us living in Royston Vasey!
I have never done it but you can also apply for land to be allocated even if you don't own it, much as you can apply for planning permission on land you don't own.
Who actually owns the land, such open space is normally either retained by the developer just in case or palmed off to the Council at the first opportunity.
2. Any idea how I keep an eye out for the allocations document updates and the frequency of their release?
See message above as you can often sign up to stay informed, Council should publicise or members should let residents know, just a case of keeping eyes and ears open!
You sound like the ideal person to ask on how to tackle it if needs must, come on, lets make the SBC planning officers life hell. There'll be beer in it!
As a former Planning Officer (Conservation Officer actually) before I went over to the dark side, I an normally fairly sympathetic to Council Officers as its an underpaid and over stressed job for most of them, however, Swindon BC are possibly the worst authority I have ever dealt with so yeah - go get them!