I just managed to broker a peace with my own kingdom! Yay!
How this happened:
I've been at war with the Vaegirs for ages (After I renounced my oath and snagged Rivatcheg -_-). Recently I've tried to make peace, by repeatedly sending out my most charismatic companion (he even has the damned persuasion skill trained). But Yaroleg wouldn't accept.
I then realized this might be because he's been rotting in my jail for a while.... So I head home, and release him.
After the conversation where I released him, I could still initiate a new conversation. In this conversation he acted like a normal lord, and I asked him for peace. He accepts the peace offer, and when I return to the map again, I get a message saying that I've just made peace with my own kingdom.
I saved before this happened, and it appears to be happening every time.
(I'm making a new save in case you need it for debugging.)
Edit: It turns out, that if you keep talking to the king after releasing them, you can negotiate the peace over and over and over and over......
Why would you want to do that? Well, you get Right to rule every time, so you can get unlimited (99) right to rule!
Edit2: Yaroleg is an asshat! He wanted peace when he was in my dungeon, but the moment I let him out, (and talk to him in his capitol) he claims he doesn't want it after all.... What a ****.