Don Pepe is indeed presented in a good light in this description. Conrad makes him an entirely sympathetic character, and yet in his capacity at the mine he is precisely the sort of absolute dictator that has been execrated elsewhere. The scene "at the mountain" in the next paragraphs is presented as an ideal of benevolent dictatorship (Don Pepe is even referred to as "father"). The only difference between Don Pepe and Guzman Bento is the crucial one of character.