Oh, no, not giving up, certainly... Just gambling with very slim odds
I mean, all the castles nearby are hardly defended at all: who knows if you could take them and keep them! One way to find out, oh yes. Indeed, it's not like your swell band of dudes is doing anything productive in your palace, now is it?
Where does the contingency Gateway lead to? I mean, you've only got two castles and one of them is surrounded by ol' squidhead. I'd say it's the classic "from the frying pan into the fire" situation.
Priam is my *****. Ride the lizard, baby!
(Of course I'm not really propagating surrender; in fact I have half a mind to keep you as a caged pet to see if you manage to do something that might disturb my peace of mind. That would also boost my image as the evil overlord nicely, torturing my fellow players by not ending their suffering...
)