No, that's a genuine bug. If Armen met Valygar in his cabin and parted peaceably with him, and then gone to his Estate in Athkatla and spoken to Hervo, Hervo should have said something along the lines of "Master Corthala is expecting you, you will find him upstairs."
Since this is a definite bug, you would have been justified in Ctrl-Qing the hostile Valygar into your party, and then dismissing him again, after which he should hopefully be back to normal. (But try Reloading first, in all situations like this.) As for the Amnish & Cowls downsatirs, well, just look at them as a bonus.
