The final part of ARR story doesn't make enough sense.

[Nialle]

The issue is, up til this point we've been fighting 'enemies of the state': primals, beastmen, etc. Enemy combatants, in other words. There is a difference between doing that, and attacking the leaders of a country after they've publicly accused us of assassination. For the same reason the leaders of the other nations left once things at the banquet started going off the rails -- the situation is on the razor's edge of civil war and resorting to violence to take the 'easy' way out of eliminating our enemies in Uldah and the Crystal Braves would come across as us behaving as the lawless criminals they're accusing us of being.

As much as it's frustrating, this situation can't be fixed by us just running around Uldah killing the people against us. At least not at this point, yet.
We have Pipin on our side and other sympathizers in Ul'dah who will help us straighten things out eventually.