Just chiming in: This happened to me today. Cast Alliance on Gregor during Stein of Moggok quest. Resist, instant death.
Hoping quest can be completed with default faction, or I'm going to cry
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EDIT: PSA - Stein of Moggok quest
can be completed by an agnostic dark elf enchanter (using human illusion in Freeport) without using Alliance. I was amiable to Gregor in FP, indifferent to Clurg in Oggok. Updated the wiki to reflect the bug and this result.