People should be killed and banned for roleplaying "evil" characters too?
You avoided very well another point I have made so far, so for the third time I repeat:
Also characters that are nuisances(AKA: Jerks) should not be kept with free reign bothering other people in Yliakum. They disturb public peace even more if not as much as brawlers and violent troublemakers.
It's not necessary, bad roleplayers will definitively find other ways to exploit the game.
Also I see what kind of "vision" this is that you so much insist:
A fairy-tales good world with only good people and...

And for last, I think no duels would be a great way to RP(Or do it OOCly perhaps) a Jerk-type of character and of bothering both characters and players without facing consequences.
I am not blind to what happens in-game.
I will put everything about this suggestion in one single word: hypocrisy