Hey, I dont know if you have already found a solution but I had the hardest damn time with this. My party was my custom character, Fane, Ifan, and Lohse, all level 21, we had the best gear we could find and our stats were great. We, however, did not even HAVE the dialogue to give up our source. Ifan automatically initiated being hateful and started the fight with lucian. After doing the fight a few times, we realized that all you have to do to initiate the second fight is get Dallis's health low enough to make Braccus start bragging. Then once we got to the second fight, we got our butts handed to us. Not only was Braccus and his minions killing us in one shot, but so were Lucian and his buddies. I must have tried every conversation option, every fighting style, stocked up on intelligence potions, HP potions, stoneskin potions- the works.
Turns out, it is Ifan. If he is in your party, you dont get the option to give up your source.
So we kicked him out. Right before we entered the tomb, we had Ifan leave. Then we only had my custom, Fane and Lohse. Went in and started the dialogue and we got the option to surrender our source. Doing that made them our allies. They never actually got to take our source because Braccus interupts and that goes to the second fight, but then it is your three characters and all of Lucian and co. fighting Braccus. It is so simple.
Ifan's punk a** just wouldnt let sh** go so he kept dooming us all.