@Doomer
MC knows from personal experience that even if the town is dead, the people are still alive.
The fact is that the town either way will eventually be attacked until its gone, this way the greedy nobles will be satisfied, MC gains prestige, but everyone stays alive.
I can see what hes trying to do. By burning the town the other nobles will stop trying to attack the town, and the townspeople stays alive. He'll probably give them all shelter in his own region.