We can stop that wrong without costing us her friendship, though. I'm certainly not saying we should let her run roughshod over the SDM. That definitely needs to be stopped. if we're the aggressor in that situation, though, it will cost us that friendship, whereas if she's the aggressor, it won't. She will have been the one to take the anti-friendship action, and we can forgive that after all is said and done, because either she went nuts with power (which we've been told is not uncommon and have heard directly from a victim of such that she appreciated what was done for her) or because someone was manipulating her. In either case, it wasn't really her doing all this.
I'm not afraid of the fairy army going after us. Renko will want to talk things out with us; our being there at all presents her another opportunity to win us over to her side. If the fairies ignore her and assault us anyway, then either she comes to our rescue, which confirms the friendship (or at least turns her against the fairy army once it becomes obvious they'll be taking the mansion for themselves and not her), or she goes on without us, which would be enough of a gesture that I'd consider it the opening move.
EDIT: You know, I wonder if Lemon Drop is a part of this army. So much for "no good squads".
EDIT 2: On the subject of "asking someone why they want something", I don't trust Renko to give us any sort of straight answer, I don't trust the fairies to give us any sort of sensible answer, and we don't have easy access to the mysterious benefactor, so.