I fought my way through till I found Nedmar, which he mentioned the passphrase and to use disguises. I equipped the priest robes on everyone and walked into the sanctuary room, and the Temple Guardian started a conversation which I used passphrase, but everyone else still attacked or they would follow me and just cast blessing all the time and won't stop.

 

Did I do something wrong or is this another bug and I'm just better off wiping everyone out?

Attacking any priests atop RH will cause them to remain hostile even if you equip the robes. Having them before hand, however, will let you blend in.

 

For what you describe, it looks like you took the former action.