It's that kinda stuff that I RP for. Good times.
There is always one. If this was an in character position it would create for really interesting party tension and lots of beautiful role playing. As a DM I would love to have a PC say that to one of my other player's characters ICly. That would be great. But if someone said that OOC to another player and tried to play OOC politics turn the party against a particular player, I think I'd pull that player aside and ask him privately if he wanted to continue to be welcome at my table. I hate it when people can't treat the game as a game.
It probably did. And his character has every right to feel that, just as your character has every right to decide how to handle his conflicting loyalties.
And again, his character has every right to be angry about that and to ICly confront your paladin and for both of you to have a good time role playing. But he has no right as a player to get upset with you as a player for playing your character in an intersting way.
I'd like to note my objection that no Neutral Good person would ever believe that. Nuetral, sure. LN or CN, sure. Perhaps some LE's or CE's feel that good must exist in order for 'the strong' to always have something to repress and put thier boot down on (this argument is made in Orwell's 1984). But no NG's accept the idea that the universe needs evil in it.
Your druid friend sounds distinctly neutral in world outlook.
I agree. The DM does need to get control of the arguing, but I don't think thats the way to do it. He needs to make sure everyone remembers that the argument is just in the game, that ultimately what happens doesn't matter so long as everyone has fun and that caring so much about what happens that you are getting angry at other players is destroying the fun far more than anything short of a TPK could.