Are you implying that medieval sources would consider the latter worse? Because both Christian and Muslim sources admonish Richard for doing this (the "most" favourable Christian source has an entire paragraph of excuses), some even suggesting he felt guilty the rest of his life, while giving zero damns about Saladin executing a bunch of lords not even a decade prior. In sources from the 1100s and 1200s at least, lords are only even mentioned in terms of their ransoms.
In the context of the game, I really don't think anyone except the close family of the dead should give a single crap about you executing them. Calradia has something like 200 lords, there is no central moral authority like the pope, and it's "supposed" to be set long before the link between mounted warriors and nobility even existed.