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There is no right or wrong; it's just the perspectives of the Human Clan and Demon Clan that differ.
From the humans' viewpoint, Lady White Bones's actions are undoubtedly wicked to the extreme. However, from the Demon Clan's perspective, everything she did was justified.
Just like humans hunting animals for meat seems natural, but from those animals' perspectives, who lost their families, aren't humans also evil to the extreme?
Lady White Bones's strength was still commendable. If she could be recruited, she would become a valuable ally in the future.
Therefore, after Lady White Bones promised no longer to consume humans, Jiang Liu didn't insist on killing her and allowed her a chance to live.
"Thank you, Little Monk! I'll never forget this great kindness and favor!" Lady White Bones spoke out and watched as Jiang Liu left with the old man and the young girl, loudly expressing her gratitude.
Indeed, gratitude was what Lady White Bones sincerely felt towards Jiang Liu.