B-Permits, C-Permits, Naturalisation: yes, it can seem confusing but instead of relying on others, go to the source:
http://www.bfm.admin.ch/bfm/en/home/...ufenthalt.html
This is the official Swiss government site and it has all the information on the latest regulations in English.
B- and C-Permits have to do with residency, not with naturalisation. So, for example, I came here already married to a Swiss and had a B permit. I was naturalised before I was eligible for a C-Permit, as the rules are more relaxed for a facilitated naturalisation than for a C-Permit.
As for the facilitated naturalisation process, the required 5 year residency requirement begins AFTER marriage and does not have to be consecutive but you must have been living in Switzerland the past year. (There is an exception to this if you are the spouse of a Swiss expat.)
The laws relating to all permits and all forms of naturalisation are federal, as opposed to cantonal, but the process (forms, checking about requirements etc) all happens at the cantonal level. The relevant law is: Bundesgesetz vom 16. Dezember 2005 über die Ausländerinnen und Ausländer (AuG).
hope this clarifies things some.