This episode did make a pretty strong case for Amon. In return for neutralizing known criminals, he has somehow been branded "public enemy number one." On a council dominated entirely by benders. They then proceed to lead a violent ambush raid on private citizens, even though, insofar as we know, chi blocking isn't even illegal, and no one was given a chance to surrender if it was. Is there any rule of law here, or do benders just get to do as they please? As for why he never took away Korra's bending, I don't think he had a reason to as of yet. If his goal is really a spiritual and religious challenge to the current system, it was never really about just beating someone up in a fight. He'll want to do things that maximize the public impact of his movement, and right now keeping the Avatar operational seems to agree with that.