Unfortunately exploring code with nearinfinity is the best I can do, I am not familiar with this language whatsoever ><.

Thanks for your quick reply though. Hopefully someone who can help, finds this in the future.

In the meantime, maybe have a dialogue pop up where edwin/dekkie indignantly demands whether PCNAME is attacking them on purpose or not, to which you can say it was a mistake / outright declare war?

The exact quote is: 

Charname "you have just made a very bad mistake."

its "@98 = ~<CHARNAME>, you have just made a very bad mistake.~"  from erdekaras.tra

It feels like I selected something antagonistic, but i didn't.

UPDATE: I used a lot of AOE in the fight, and a cacofiend [playing insanity mode]. I can't promise that I hadn't accidentally cast some hostile spell on him by mistake though, since there were so many enemies all clustered about.

I went back and looked at the code, looks like I somehow damaged Edwin mid fight and triggered "Edwattpc" variable. I deleted the variable using EEkeeper and the issue didn't recur. I also played this on story mode and cast no AOE, just melee'd them to death and didn't have any issues. 

P.S. I'm not sure Edwattpc trigger is a good idea. friendly fire happens a lot in this game. This  betrayal should be an active dialogue choice instead of accidental poison tick from cloudkill or something. Also I have my rod of resurrection for my eddie if he does kick the bucket temporarily...

Spoiler warning:

I've run into what i think is a bug where as soon as you-know-who comes and gives me the phylactery and joins the fight.... if I speak to him both he and edwin turns hostile: "<PCNAME> you have made a big mistake. "

The same happens if I don't talk to him and just finish the lich fight. At which point he speaks to me and says the same thing and starts attacking. I'm not sure what to do. You know who is immortal as well so killing him doesn't seem to be the quest line.... I have banco's ring, banco trapped in the phylactery and the used up teleport ring, and ofcourse edwin's silly hair necklace.

Please help