The literal question Cain asked may have been "Did those stories really happen?" But he doesn't actually care about those specific events. His real question, spoken in subtext, was: "Are people in this country really executed for such minor offences, just because they get branded as treason on a technicality?"
His father understands his meaning, so instead of just answering the explicit question and saying "Yes those things happened", he answers the true question: "Son, use some common sense. If we killed people for merely throwing rocks at walls, you'd have been executed a long time ago. Yes, the law says the punishment for treason is death, but the royal family gets the final say, and they say to be lenient. You should know this, because you've already benefitted from that same leniency."
If you notice, while they said that the hatless man and the rude young boy were charged with treason, and the penalty for treason is death, they never actually said that those people were executed. They were just bringing up those stories, and obscuring the fact that the royal family pardoned them, to frighten Maximilian and to justify punishing him for the attempted kidnapping, without having to officially accuse him of attempted kidnapping.
It's not a non-sequitur, they're just communicating in implication and subtext. Cain couldn't literally ask his real question out loud, because he was worried that questioning the law of the royal family might constitute treason against the royal family, which he now realises could get him killed. His father reassures him that people aren't just getting their heads lopped off for no reason, but also cautions him that he should still be more thoughtful about his actions towards the royal family in future, because they've already shown him serious kindness without him even realising. That's the subtext.
