Nothing you posted changes the simply fact that nothing good comes from banging an employee. It doesn’t matter how the relationship came about.
If nothing else, your post demonstrates they both should have known better to begin with, given their established relationship.
This is ‘bloodsport’ and they left themselves wide open to this unfair attack by their own actions. Given the hysterical rants about anyone associated with the Bush Administration, not to mention the corruption of the World Bank and its politics, this was the end result of poor choices by both of them.
Just my opinion. I have no axe to grind with Wolfowitz or his girlfried. But the results are predictable, under the unique circumstances found at the WB.
This isn't about "Banging an Employee" it is about a cynical series of moves by folks who wanted to discredit Wolfowitz. This is all about the terms for her termination. Which are governed by law as well, she cannot suffer just because of the relationship either or this can be construed as Harassment just the same.
The Lefties set a bear trap and he walked into it thinking he had secured his hind quarters and with an eye on cleaning up this corrupt institution. They probably approached him to say, now we have you and he said nothing doing. So the crap hit the fan.