Regarding Harry in the first pic, I toasted him my first time through as well with just my mage/shaman/rogue team. You don't find out that you need to let him live until he's dead and you find that there's nothing to loot. Just gotta take it easy on him, probably best to just solo him with your main.

The elite smith dude in the Shat tavern always gave me issues as well where he should reset at about 25% health and become friendly again, but he has a tendency to bug out and simply reset his hps and start fighting me again in the blink of an eye. I think the trick I learned with him is to pull him at least a little bit away from where he normally stands so he has more time to reset.