I don't think the two different narratives are exclusive.
Cenrae saw FR getting boring as it became near-silent with no interesting conflicts. So new activity and conflicts had to be found. So stir things up with a merge to Asylon.
However, I would argue that the presence of a genuine political struggle in FR is irrelevant. The OOC motivation is clearly stated. Now in my opinion the realm merger ban is total crap and has no point or game benefit. But the rule exists and, if we're going to enforce it, I don't think there's a clearer example than this. We have a powerful player who decided to launch a merger of all but one regions in order to rejoin a war that a majority of the realm's players voted to stop fighting. Now maybe those players have changed their minds; fine.
But the point is that, insofar as the merger rule has a point, this is it: to make it so that influential players can't just drag their vassals around into the flag of their choice. You can't just shuffle whole realms around to optimize who is in your message recipient list or what your noble-to-region count is.
For myself, I sympathize with the desire to merge to Asylon. FR was pretty dull the entire time I was there. The only conversation I ever saw was conversation I started by approaching various nobles or starting fights about foreign policies. It was generally a pretty quiet realm and suffered from attrition and a sense of helplessness and pointlessness.
Such a realm can only really end three ways: revitalization by some means (a new war, culture change, new nobles, etc), merging into another realm, or death. FR wasn't looking at a likely revitalization, death isn't usually preferable, so Khari went with a merger. It's a reasonable choice and, in the absence of the rule, it's the one I would have made too. But the rule exists. In the current regime, the proper end of FR was a death spiral of noble depletion and starvation, leading to a wide wasteland between Phantaria and Astrum. That would be a lot of fun for the nobles of Phantaria as they could expand northwards, and lead to some Asylonian expansion too. It's not necessarily a worse result for the game, or even for FR's players.