This is the story.
I embarked with nothing to give myself a challenge. Half of the map is terrifying and spawns wretched creatures. Despite this I managed to get a good 14 dwarves and some cattle behind a wooden palisade... when giant zombie sparrows attacked.
I mounted a stand within the confines of the palisade and the dwarves slew 2 sparrows but were overwhelmed. Every single animal and all but one dwarf was slaughtered.
After the survivor had secured the fort, some 3 dwarves migrated to help out.
Unfortunately one of these has a pretty bad temperament. He felt terrible because he saw a rat, because he didn't have a proper room, was caught in the rain, drafted etc, etc.. so he murdered his wife.
I appointed one of the others as sheriff and the sheriff beat the murderer, though not severely. Urist McMurder went to complain to the expedition leader (sole survivor) but ended up attacking her instead. She went to report the crime but, since the sheriff was busy, she went to bed.
Urist McMurder walked into her bedroom and caved her skull in.
At the moment Urist McMurderer is locked up. He has killed 50% of the fortress population and right now he IS 50% of the population.
How would you do in this situation? If I leave him in jail he'll probably be so miserable that he'll die and all hope rests on one single dwarf... but if I let him out he might go crazy again and all hope will rest on one unhinged murder-dwarf. It's also a tremendous burden for the sheriff to do all the fort's chores on his own.