At the end of Ip Man 2, I was annoyed that Ip didn't beat Twister to death the way Twister did Master Hung. I thought Twister got off lightly by still having his life whereas his victim didn't. Some time later I realised: It's Cruel Mercy! Being the horrible racist that he is, if Twister had died fighting in the ring he would probably have deluded himself into thinking that he would be feted as a hero by the British for going down a fighter. On the contrary, to have Ip spare him, and then to witness the British in attendance applaud the speech made by Ip about learning tolerance, is something that shatters his worldview. He will never be the same for realising that not everyone shares his hateful mindset. — Gentlemens Dame 883
Still not good enough: The fact Ip Man did not cripple the bastard means he is going to go back to England to CONTINUE having a successful boxing career and die peacefully of old age with loved ones around his deathbed. Reducing him to a gibbering vegetable that has to beg for its bread and water, not to mention even walking to the toilet, is the ONLY justice fit for destroying a Lineage of Chinese Warriors (which is what he did by murdering Master Hung before he can complete his teachings to his successors). Twister got LESS than his just deserts.
Cruel Mercy aside, Ip not killing or crippling Twister prevents Twister from becoming a martyr. Rather than making Ip look like a savage retaliating for the death of Hung, Ip came across as honorable and as Dame mentioned, his speech actually got applause from the British audience, doing more to further the plight of his people and fight racism in the future. Plus... seriously. Do you really think a guy like Twister is going to peacefully grow old? He'll probably be shot by someone he beat up in a bar.
Why did Master Liu randomly decide to fight three at once? Not just because General Miura won a 1v3 fight previously, and as the ranking Chinese master, he has to match what the ranking Japanese master does - but also because the one Chinese fighter who got killed, Zealot Lin, was Master's Liu's student, and he probably heard about it! Too bad his skills just weren't up to par...
Master Hung's death has more repercussions than just the loss of a great martial arts master; his death leaves his wife and seven children without a source of income (and they've lost their beloved father).
A silver lining on this dark cloud is that a Traditional Chinese Martial Arts school is like a family, with the teacher as A Father To His Students. (Shifu/Sifu, moreso than merely "teacher", is also a homynym for "Teaching Father") Moreover, in Chinese families it is an obligation to support your elderly parents when they fall on hard times; more than likely orphans and homeless delinquents given a chance at life by Master Hung, it is a certainty that his students would now repay his love and kindness by looking after his widowed wife and fatherless children. Point in fact, the wife of your master is reverently referred to as "Shimu", which literall means "Teacher-Mother." Master Hung's Family Will Never Be Alone.