At first glance we assume that by "this," Mrs Gould means the imperial swallowing up of Costaguana, and that her question means, Do you believe that that will happen? But I think she is really referring to Charles Gould's central point, that Holroyd has sublimated his personal desires to the cause of material interests, so that he no longer cares about defeat or death. "This" is a form of materialism far more "awful" to her spiritual sensibilities. Her question means, Do you believe he has really sublimated himself to that extent?
In this reading, it is worth wondering what would have followed her last "and."
It is very likely that she would have gone on to worry that Charles, too, would
sublimate himself to his cause to the point of disregarding death -- which is
exactly what he does do when he is led out to the firing squad in Part Three.