Indeed, the disagreement at the table seems to be in the severity of the reaction.
It seems to me that trying to expose the falsity of the accusations opens up a whole sub arc of the plot - which could be really cool to play out. But since the outcome was not expected, in terms of severity of the world reacting to their choice, the player went into OOC PvP mode with the ST due to the above mentioned (by numerous posters) difference of a mental map of how the world works.Depending on how the false accusations were handled,