Viver ou morar.. which of this words is more common? both?
Both are common.
Morar is more common, it means "to live (in a residence)".
Viver can have more meanings.
I've never heard anyone use viver to talk about residing somewhere, I've only heard it to mean being alive, so I think morar is the more common.
Why! "Who does live in the castle?" is not correct!
When "who" works as the subject of a sentence, you do not use an auxiliary verb.
You might use it for emphasis, Someone says, "The king does not live in the castle." You say, "(Then) who does live there?". But without some sort of context it is not correct.
What is wrong with vivem? There might we more than one person living in a castle?
"quem" requires verb in singular (you would not say "who live...?" in English either).
Thanks, that really helps!