Is there a reason to defeat Nemnok from the RP perspective for a not-too-aggressive PC? The settlers seem to like the arrangement, as do the people (including the flame naga) working for him.
If Nemnok wasn't the strongest non-dragon boss in PoEII and one of Junvik villagers wasn't unhappy with his son's occupation, would you attack him?
Also, I took Nemnok the Petite to visit Arkemyr. No reaction from either of them.