Let things burn

If you do your job, you'll end up with a village and a bunch of NPCs that the players care about. That you care about.

Do not protect them.

You have to be willing to let bad things happen to the village and to beloved NPCs. Stay within the boundaries of your group's content guidelines, but otherwise: take the gloves off. If the stakes aren't real, then the PCs' heroism isn't real, either.