Tactics Ogre: Let Us Cling Together - Balamusa Escape

The next battle in sequence is post argument with your friends against some of Ravness's allies I guess? Vyce and Ravness are both pissed off at you for making the decision to murder everyone. Denam proceeds to burn the town after the battle. I'm still confused as to how burning a city full of people is the righteous thing to do on the Lawful route but whatever.