In your campaign, how are you running Neff? Specifically, how does he react to news or rumors of the exploits of the adventurers?
According to the backdrop article in 124, much of Diamond Lake's original economy was founded on treasure from the nearby cairns. I'm assuming there would be laws in place for the Governor-Mayor to assess taxes on this loot. Does Neff has jurisdiction over the hills? What is a fair assessment of taxes? The DMG suggests 20%, and I'm assuming Neff would extract every copper possible.
How would he learn about the treasure obtained? Would he give bribes or threaten extortion to Tidwoad, Taggin, Tyrol Ebberly, etc? What about Allustan? Would he provide a tips to his brother?
What about the possessions of the cult? Would the law transfer ownership of these possessions to the adventurers?
Who would administer the law to Dourstone? I'm not sure how it would work in Greyhawk, but in Eberron I don't think the administrators in Wroat or Sharn would even raise an eyebrow about cult activity in Diamond Lake. There are a large number of Dark Six cults in the lower wards of Sharn alone. From the more metropolitan Eberron perspective, simply revering evil doesn't seem to justify a huge cause of alarm by the majority of leaders in Breland. I'm guessing they would just want to know the bottom line: how does this impact ore production? The area is probably generally considered corrupt and full of vile miners to begin with, so it would come as little shock to find out that some of the residents cope with their miserable existence by torturing themselves and wanting nothing more than apocolypse. I think they would leave the matter up to Neff.
WC implied that Dourstone was under some type of possession or domination during Smenk's tour of the cult. 3FoE has a one sentence line about using magic to control him, but what exactly did the cult do to him? One of my players has a psion character who read Smenk's mind and knows that Dourstone was acting "unusual". Another player has a paladin who is aspiring to be an exorcist and wants to know how to detect if there is some type of possession involved. Is it simply a charm spell?
If Neff seizes all of Ragnolin's assests then all of the mine managers will scramble to acquire the rights to his successful mine. Smenk obviously has the advantage, and in my campaign he is not convicted for his dealings with the cult. In fact, Neff will commend him for selecting "hirelings" to aid brave Balabar after he scouted the operation for them. How did other campaigns deal with this major economic shift?
Also, what happens during an attack in Diamond Lake? For example, when Ithane attacks, where do the townsfolk go for protection? I'm assuming Neff would be required to open his gates and require all able bodied men to defend his manor. Would the militia primarily defend the keep or aid Neff? What would the mine managers rely on? Considering the importance of the mine managers I'm surprised they haven't pressed for city walls.
More thoughts:
In my campaign, the managers are going to bid on Dourstone's holdings, specifically the "oldest mine" in town, the one with the cultist area. Smenk is one of the bidders. Mur, the copper manager from Blackstone, is now also interested. This puts Tilgast in a pickle, since the reason why Mur is in town is to form an alliance, yet now he is competing with him over the land. It also causes tension between Gansworth, Perrine and Tilgast. On top of this struggle, all of the managers fear that Smenk will finally gain enough resources to undercut everyone. Only Moonmeadow cares not, for he has seen the humans squabble over iron ore for decades while his silver monopoly remains unchallenged.
The PCs will meet with all parties at some point. Tilgast will ask them pose as Smenk's agents and "persuade" Mur into dropping his bid. Gansworth will meet with them at the Rusty Bucket and ask them to hijack a crucial supply shipment (full of bribes to Neff) for Smenk, humiliating Balabar during the negotiations. Perrin will ask them to kidnap Constance Grace from the Midnight Salute, and afterwards break into Neff Manor to acquire blackmail evidence on the other three mine managers. She plans to hold the harlet and papers as a "bargaining tool".
If the players are smart, they will learn that the only good person worth fighting for is the visiting copper mine manager from Blackstone. He is conceited and bad mannered, but he takes great care of his miners and believes in helping others. His "mission" for the PCs will involve finding the Curlyfoot crew. Although he has no connection with them financially, he worries about their where abouts when he doesn't see them at the inn one morning. Two of them are found in the Emporium, wasting away in an opium den. Two more are stuck in the kennel of the Feral Dog. The other three are locked up in the Sheriff's Office for "inappropriate behavior at the Midnight Salute". (No charges were filed by Purple Prose, Cubbin just didn't like the look of the halflings when he saw them exiting the establishment.) If Mur finds out that the halflings are going to be executed for their crimes, he will cut a deal with Neff that involves retracting his bid and leaving town in exchange for their freedom, which all of the mine managers will pay Neff dearly for.
I would like to offer the PCs the opportunity to help Mur buy the mine. What would be a reasonable bid on the property? If the town's total assests are worth 40,000 gp, are the mines considered part of this? Would 5,000 gp be a fair fee for obtaining mine management status?
have you seen the Dukes of Hazaard? THe orignial series was a childhood favorite of mine. When it comes to Neff, I just use the WWBH philosophy. . .
What Would Boss Hogg do?