1. It seems to be a bug in the game: it must not have been meant seriously. Yes, you get 10 millions of XP. Naturally, these XP will be divided only between the surviving party members
2. No, there are no consequences raised by killing Oakenmir. The game threatens again and again what all will happen when you commit an evil deed but - nothing will happen. Most likely, the game creators planned some punishment but they did not implement it in the end.
In the other words, killing Oakenmir is a matter of your conscience. Nothing less, nothing more. I have to confess that my conscience shrinks somehow when it comes to rapid development of a newly born Zenmaster [img]graemlins/hehe.gif[/img]