Damian was letting you live for a reason. Leaving you to henchmen once is understandable, but after the second time that should have raised some questions. After talking to the dragon Patriarch, Damian even calls you a pawn, though was unaware of how much so.
Does every story have to have a happy ending? Does every choice you make have to have only the intended consequences? Does the information you have to make a decision always have to be complete and accurate?
You defeat Ygerna's memory of Zandalor and the Divine. Also, you are only temporarily stuck in the crystal, as that is where
the add-on continues from.
Talana gives you her power after she shows you a vision, then she dies and you pass out. By the time you wake, Ygerna has taken advantage of your weakened state (incomplete ritual) to insinuate herself in your mind, to impersonate Talana and guide you to her own ends.
Sometimes things get worse before they get better. Aleroth is opened up in the add-on (no mention has been made about the harbour, or other locations) and you will be able to act against Damian without Ygerna's misguidance. Presumably he will not be completely defeated until Divinity 3, though (the story was originally designed as a trilogy).
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