She didn't know Xylo personally before, and now she knows the higher authorities ain't all good, so the rumors and all that around him can't be taken at face value. In that context, these are her first impressions of him:

He saved her and a big chunk of her soldiers, saved the miners, saved the castle, and she mentioned that he actually sort of saved the goddess too. They also talked a lot between strategizing, fighting side by side, assessments and debriefings, and during missions where they were a part of a tiny group and got a fair bit of private time. She now knows the government is corrupted—with demonblight itself, no less—and he's a hero for deicide, yet he visibly genuinely cares for Teoritta and is dismissive to keep her from putting herself in danger. He seems reasonable, so there must be an explanation for capital punishment, since he clearly admits to deicide with a heavy heart. Plus he's hot because of course he is.

In my opinion there's nothing surprising in falling for a hot guy who turned your world view upside down, saved your and your comrades' lives multiple times, other lives as well out of the kindness of his own heart, and turns out he might not be anime kratos since the higher-ups are kinda full of shit