Yes, you can be kind in the game. Another example is the moment when you can mediate between Barth and the kid who steals the locket. That one scene can go a few different directions. My favorite is the one where the kid admits that the locket reminds him of his mother, and Barth lets him keep it.
The kid is also telling bald-faced lies, completely shamelessly, but you are
not allowed to detect this at all (there is no check) until after the matter is resolved and you go talk to the kid again - at which point he soft-ridicules you and makes it clear it was a pack of bullshit so he could keep his loot. ... So, once again, the game treating you like an idiot and a whipping target, without giving you any recourse against it once you made that choice, which is what others in this thread are complaining of.