See, to me, MarkCMG and you Hassasin are the reason that players almost never take prisoners. I've played with more than a few DM's who will do exactly this sort of crap. "Oh it's justified because I can pull examples out of the air to justify it". Gimme a break.
The only reason the prisoner ran away is because the DM was being a dick. He changed the rules because he didn't want the players to get any sort of "unfair" advantage over his carefully crafted adventure and hadn't planned on giving the players information.
I think we'll have to agree to disagree here, though MarkCMG seems to make the same points I would. It's my opinion that diplomacy and intimidate should affect NPCs, but not make them puppets. Anything that the rules don't prevent an NPC from doing is ok. Also, people do irrational things, so should NPCs (and PCs!).
Regarding the DM, I wasn't there so I obviously can't say whether it would have felt like the DM was being a dick. I know I don't expect things to always go my way as a player, and even when I succeed it might not go as I thought. Failures, especially unexpected ones, have often lead to memorable events in our games.
This is probably about more deep-seated differences in approach to roleplaying and drama. I like facing unpredictable things, and I don't need to always be in control even of my own character. I don't see it as a game to win the scenario or the DM as a "referee" who should only follow the rules like a computer.