Phew! That was close!
In the end, we survived and so did almost everyone else in New Cyre.
It turns out that the "demonstration" scheduled for that morning was to be a small, temporary version of the Cyre disaster, and all we did was trigger it a bit early. We managed to escape the dungeon just ahead of the cold gray mist, bypassing various hazards and incurring only a couple of negative levels.
A crowd was gathered in New Cyre to watch the demonstration, and when they saw the cloud boiling out of the mountain they panicked. Cries of "The Dead Gray Mist is come again!" etc. But just before the cloud of mist reached the place where the nobles had been sitting, it stopped and retreated back into the mountain.
Only a few people were killed, and more of them would have been caught in the mist if we hadn't panicked the crowd and got them running.
An illusory image of Patria appeared and threatened to destroy Breland if they didn't grant independence to New Cyre. But it seems that Prince Oargev wasn't really in on this plan
So we're heroes, our pictures are in the Sharn Inquisitive again, and we've got titles and land in Cyre (if anyone ever fixes the Mournlands). Plus, I rescued my father and my aunt from the clutches of the evil Patria.
Patria got away again, but that's to be expected. She's a Recurring Villain until the DM decides otherwise.