Well, yeah I know that Virtue's not supposed to be a reward, regardless of what I said earlier.
About the "freeing children" thing... yeah, it's the right thing to do, but getting Virtue points for that, I think, is unwarranted, since there's not such a lot of points, anyway. If the max were 100, that would be okay, I guess...
And yes, Paladins wouldn't knowingly associate with evil characters, but... despite their alignments, Viconia and Korgan aren't evil. Korgan is more Chaotic Neutral actually, and Viconia never really gives you a reason to think she's evil other than her being a drow. She does get to change.