So I've been messing around with the creation kit for a while and figured out how to do the routine stuff like attaching magic effects to a weapon. However I'd really like to make a sword which shoots a fireball when I swing it. I tried to use OnAnimationEvent but it seems unable to catch any event. The documentation on the wiki is very brief and doesn't help much. Is there any way to use the papyrus script to trigger something when it detects some action from the player?

You can do that. It is possible.

I dont know how, but there was a thread about it in the Modding forum.

They were doing it with the console and adding spells to weapons and armour.