Scripted roleplay has only two places IMO, namely:

(1) full-sized events run by a group of people in positions of authority eg a clan's leadership, a city government, an interest group or the admins.

(2) roleplay within roleplay, such as a theatre performance (which is probably the most confusing sort of roleplay ever, since a player is roleplaying a game character who is in turn roleplaying a character in the play)

In the case of (1), the event should be viewed as an interactive play, where only the performers have a fixed script of any kind and the audience, while they may have a very rough idea what's going on, are free to respond in any way they feel appropriate. This would, I think, include even scenarios where the audience is going to get assaulted by the actors. Otherwise, everyone's going to be on stage and there's no element of 'game' in it at all, just enacting some fixed moves. (By implication, the actors' script can't be all that fixed either, because it must be able to shift to accommodate the entire spectrum of audience reactions.

But whatever the scenario, I believe that there is absolutely no way you can inform everyone of it, or ensure that "everyone's happy with the outcome". Firstly, there will always be some clueless people wandering into the middle of the scene and messing it up - or some jokers messing it for fun. Using your example scenario, all it takes is for someone to switch sides suddenly and bang goes your script.

Secondly, I think it really is a given that there is NO way everyone will ever be happy. Unless you set up such a bland scenario that no one is hurt or insulted in any way, loses anything whatsoever, it's inevitable that horns will lock and someone will come out a little worse for wear. Speaking with some stage experience (back we go to the play analogy) the actor taking the role of a character who is severely insulted and harmed is going to identify with that character and feel royally ****ed off on the character's behalf at the very least. Especially if his counterpart does a great job at the insulting. That is all the more amplified for a gamer who's invested hours, effort and maybe money to gain skills, eq, level, reputation, position blah blah.

That said, here's my personal and unflattering opinion of people who demand to have everything known upfront. SORE LOSERS!!!