Obvious spoiler.
I told Gortash I'd think about his deal during our first meeting. I rescued the hostages (game stated that this would make Gortash's deal unavailable. I destroyed the foundry pre-assault and disabled the steel watch. I brought Karlach with me to the Gortash fight. I fought the bottom floor enemies (everyone hostile) but skipped the coronation hall (patriars and nobles + some cultists?) and climbed the walls instead.
All flaming fists were hostile (mainly bottom floor). All bodyguards were hostile (ground floor, mess hall). Patriars and nobles we're neutral and ran away unless attacked. All cultists (coronation hall and Gortash fight) were hostile. Gortash had some dialogue with Karlach and said that he made a deal with me. My only response was to side with Karlach.
Just like the rest of the game (especially act 3) there are plenty of missing or broken flags concerning story progression. That it ended in a fight was expected and that I didn't have any choice made sense. From what I understand there's a lot of Gortash content missing though and his entire story arc feels a bit empty.
Unrelated spoiler (meeting Volo in act 3)
If you keep Minsc in your party he'll just go ahead and trigger a fight for you (not sure what happens if you don't have him in your party). I think it makes sense that Minsc and his chaotic good nature makes such a fight unavoidable in the same way as me not having any option to support Karlach and get into a fight with Gortash. Reflecting my support of Karlach, her relationship with Gortash and my previous actions.
