I have some pretty big issues with your guilt-by-association hypothesis, but on the whole that was much more restrained than I was expecting. Bravo.
Call it guilty-by-association if you want, but I never called for every player of Aurvandil to be locked. However, I do think that Tom and the GMs should send an extremely clear message that cheating does not pay off, for anyone, and that looking the other way is never acceptable. There were plenty of reports of things being amiss in that realm. If Aurvandil gets to maintain its ill-gotten might, then it just tells everyone "you may as well just ask a few friends to make a ton of multies to help your realm, 'cause even if the multies end up locked one day, their contributions will be maintained". It's an atrocious precedent.
Cheater(s) changed Dwilight for good, and now some collaborator will get to inherit it all. And it pisses me off.
Heck, skimming through some of the locked accounts, isn't one of the lords who defected from Barca's "corrupted governement" and started this whole war... one of Mendicant's accounts? Oh, and look who else... The impotent general who had D'Hara attack Lurian forces alone and outnumbered? I see a member of a rebellion in Libero Empire, and nobles who've been to Astrum, to the Lurias. And I only bothered looking through a small part of Aurvandil's accounts (70 nobles is a lot of names to click through). This guy has been influencing events all over Dwilight while he was as it.