Thinking a little more on Praz: I don't buy that me being blocked by the Watch is a mistake by the mod. If so, he would have mentioned it. So, that means Praz is either lying about being involved in the block (which is past improbable), he's a member of the Watch (in which case both he and FT are lying - also improbable, but they could have synched stories for whatever reason), he's the Patrician, or he's a magician who didn't really send two Watchmen, but hypnotized me to believe I did (or some such).

Not really sure about the Patrician, but he's very protective about the City and may easily be presented, for game purposes, into a xenophobe. It would actually be very in-character for the Patrician to organize the Hippos himself, then see what happens and either claim succes in defeating them, or claim succes in removing the foreigners.
Magicians are also not really known for their liberal views, but I guess that depends on the individual player.