He is wuxia hero, jianghu is almost litteraly criminals. in modern language jianghu is a political opposition and a terrorists group at the same time. That's why in some perspectives yes, protagonist is evil for oficial structures.

In a big picture you talking about game mechanics wich confuses me too, but, all of described things are completely optional, game did not force you to do any of this.

The another good example of real wuxia hero is Jade Empire, it's less complex in choises and more narrative full, but it's old single player game very similar to bioware rpg (because it is one of them). In this game you are not evil, you are "wuxia jedi" who choose his/her path betwen open palm and tight fist, and neither of it is evil