I have to say I've not spent much time on this series, and none at all on Waterworld. Is it on the Flashbacks?
Swordquest was back in the news because a comic book company is making new Swordquest comics. Its kinda a meta-comic though, not the continued adventures of the blonde twins from the original comics. Instead, we get an older gamer who goes back to live with his mom - finds his old Atari stuff - and this reignites his old obsession with Swordquest. This leads to finding out that the items still exist, and are going on display, so our old gamer gathers some of his loser buddies for the heist of heists. The first came out in the early summer, but I've not seen any news since. So, like Airworld, Swordquest #2 may never see the light of day.
By the way, I've always been fascinated - not by the games - but by those Franklin Mint prizes! Two were awarded, maybe three - and who knows about the fourth and then the final one, the Sword of Ultimate Sorcery! (Ta-dah-DAH) There was a story that the Sword was in Jack Tramiels home, over his fireplace. Unfortunely, according to the author of Atari Inc Business if Fun, they were most likely just melted down by the Franklin Mint when Tramiel took over. The Franklin Mint, then also a Warner holding, was struggling financially and sold off during the 'Crash. Some investment house bought it, and they would have likely just melted down something like. When the ship is about to sink, you don't worry about the possible future value of what's in the vault.
This would mean that there is only the 1 Swordquest prize left in existence, the Chalice of Light, which was the second prize won for Fireworld. The first prize for Earthworld seems to have been melted down almost immediately by the winner. Its unclear, but doubtful, the third was ever awarded. So, sadly, they were likely melted down into whatever Franklin Mint was minting in 1985, which were model cars, civil war chess sets, and maybe some replicas of the Headpiece of the Staff of Ra or something, I guess. http://www.atlasobscura.com/articles/the-quest-for-the-reallife-treasures-of-ataris-swordquest