I think it's a matter of interpretation. Mine is: you didn't kill these guys leaving only the merchant, you just gave them a beating, afterwards each party gathers on opposite sides, the merchant gives a last rant, then leaves. Don't forget that they are still 15 people, you are only 6+Corselia.
The thing is, you are on some kind of secret mission in enemy territory, enemy because you're allied with the Island Nations. So what would you do in this situation:
1. show these Kooluk people how they should deal with it and behead these criminals in public
2. stall the criminals and wait for the very same commander you've just beaten up in El-Eal to hand them over and getting arrested yourself
3. let them go for now and hope you'll meet them again outside of town, in a place without audience
I think letting them go for now wasn't too bad a decision.
"Within the four seas, all men are brothers" Shuihu Zhuan