From my own study of history the greatest and most vile tyrants have never came to power promising evil and destruction. They come to power promising that no one will go hungry, no one will suffer. Just put us in complete charge of your lives and everything will be fine. Looke like Cardassia has not learned a thing.
Truth is NEVER a bad thing. Truth never hurts. Truth sets you free. Truth is NEVER to be feared.
I would say that the whole novel was a study on exactly that. Cardassia, and to a different extent the Federation personnel, were attempting to change, struggling with exactly the problems you mentioned. I don't think it would be at all believable to simply flip a switch and say "okay, now we'll do everything by the book, despite the fact that we haven't done that for hundreds, if not thousands of years."
And the Feds have always struggled with the grey areas of morality. Large portions of the tv series played on just that. Would it be better to expose the truth and ruin any potential for future peace? Or would it be better to hide the truth for a time, allow peace to take root while you gather evidence, then expose it?