I have lost Melony. I left her by the inn and now she's gone. Without getting a butcher reputation everyone in town is pissed at me. I did no attacks on anyone and the three in my group were not hit by anything my solo character did. infact after killing the blacksmith, i still didn't get a butcher reputation.
Do you have a charmed enemy in your group? Like Scorpp or the guard from the traders shop? If so that would make the town turn against you... it has for me in the past- heck even Paida when I charmed her and she's FROM Homelett-- (You have to Dispel her charm from the badguys not charm her to your side). As far as Meleny, once you were an "enemy" she may have just gone home and not waited for you anymore. And I think you only get the Butcher Rep when you actually KILL Meleny... just losing her wouldn't get it for you... why you didn't get it with the Smith.. can't say...
I tend tofind that it only activates on only some of the characters. I once managed to kill all of the evil characters in homlet (like the beer maker) and a few others like the DH witches (not the pub one) with my paladin and never got the rep. Also you can even kill the odd guard and not get it.
with the newest mods, if melany gets killed and I get her resurrected, her dad attacks me, even when she's in the room with her alive. he says I had something to do with her death. just don't let her die.