Love that intelligent AI. He should have went hostile on you. Even in Fallout 2 when you attacked Vics daughter, he turned hostile on you, so how hard could it be for the devs to implement that?
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At first glance one would agree with you. But when you really think about it none of the companions in Fallout 2 were tied in with the main plot so the devs could make them turn hostile if a certain trigger was triggered or the player could even kill them just for the hell of it if he/she wanted. I believe every companion in K1 is tied to the story in some way so the devs couldn't have them turn against you, until a certain point in the DS game of course.
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Than the devs should not have given him a son that is killable or making Carth important to the plot. It makes the game experiance unreal.