[my impersonal opinions, as I read it]
SHARK, this looks to me like a very bad example of a Paladin "moral dilemma".
Everything about it looks like ham-handed, railroading, unbelievable, and melodramatic, over-the-top fanboy fiction.
This looks like choose your own adventure, with no actual input by the players - the DM controls almost everything.
This looks like basically a very cheesy fantasy novel, with limited player interaction.
The paladin obviously did nothing against his code.
Do you actually expect anyone to believe that regardless of what the paladin chose, you weren't going to screw him over?
You were in control of all the cards, all the timing, all the dialogue, all the Balance checks

...
It's very transparent, your DM'ing style, and I'm shocked your players welcome that kind of railroading and suspension of disbelief.
This "Paladin dilemma thread" is a weak excuse for you not putting this in Story Hour. [/my impersonal opinion]
But you didn't put it in Story Hour (where everyone's expected to just say "Great stuff" and hold their tongue if they don't like it).
I assume that if people are allowed to say that they dig your campaign, than I'm allowed to say why I don't like your "game".
I'm glad you still have ex-military players that still buy into it.