It's a pity they fail at diplomacy so bad. The southern realms could probably brought to actually bring military forces to support Caerwyn, it's no less far-fetched than the participation of all the SA realms we saw. And I think they would all prefer that Caerwyn remain than to see Allison as a neighbor.
Can't just barge in and spark a world war either, though. Caerwyn should have attempted to cut their losses long ago...
I think you overstate these possibilities.
Terran would not, in any world, have deployed military forces to support Caerwyn. Even our staunchest anti-SA folks categorically rejected giving military support to Caerwyn. We only ever allied with them out of an emergency attempt at forming a league around the Zuma; no formal alliance terms were ever drafted. They've been polite enough neighbors, but never really the types we would go to great lengths supporting.
If Asylon got in big trouble, we would at least
want to help. But with Caerwyn... it's not just a logistical thing. We really don't see any reason why we
ought to help. Very few in Terran know anything of Allison, and even those who do, while having a healthy respect for her influence and attitude, view the possibility of her inciting a major war against the Véinsørmoot as quite distant.
Maybe opinions are different in D'Hara, but, in Terran, it would take a pretty radical shift to get us to defend Caerwyn. When Asylon broke their colonial agreement with Terran recently, you didn't see Terran sticking up for Caerwyn, did you? No. You did not. You didn't see us sticking up for Asylon either. In regards to the north, aside from cordial mid-level relations with Asylon, we mostly like to just live-and-let-live.