I have got a similar issue here. I chose to support a Kingdom and handed over the banner at day ~600, weaken the empire and Istina's conspiracy quests started and failed 3 days later, because of not being able to finish it in 10 years. Two main quest NPCs then showed up in taverns and acted like normal NPCs.
By the way when I handed over the banner, only 3 towns and 1 castle are left to be conquered. Not sure if this matters