As for the Guanyin Hall, it is a historical remnant of the Primordial Immortal Realm.
The Guanyin Bodhisattva worshipped in Guanyin Hall was Ci Hang, one of the Twelve Golden Immortals, direct disciples of Heavenly King Yuan Shi, during the Fated Calamity.
During the Fated Calamity, Daoist Ci Hang was persuaded to defect by Saint Cundi of the Western Religion, transforming from one of the Twelve Golden Immortals of the Divine Supreme Sect into Guanyin Bodhisattva, one of the four great Bodhisattvas of the Western Religion.
The Mystic Temple belongs to the Taiqing lineage, and thus should be naturally aligned with the disciples of Heavenly King Yuan Shi, so they naturally considered Daoist Ci Hang as a traitor.
However, the teachings of the Western Religion are also aimed at promoting goodness in public, and Guanyin Bodhisattva is well-known for her great compassion and saviour of distress. Therefore, Guanyin Hall is naturally considered a righteous Immortal Sect.