Talking about being feared it works as long as the people have something to fear about(their family, their job, their career, their lives etc). If you push people too far people will lose their fear since their anger exceeds their fear. You may think the poor fear for their lives but even poor people will rise up if their lives are not worth leading. Aspirations or ideals are good to inspire but anger is as good as courage. When you have both the leader will be toppled. People who are not afraid to die in anyway until the circumstances are too late to save themselves cannot be deterred. Afterall being dead is not so bad especially if you lose your life for something worth dying for(that's a life fully lived).
Leader who relies on keeping to power by fear is not a leader but one imposing himself as a leader. A pretender. He doesn't lead but enslaves. His inability to lead his people would make such leader even more paranoid and afraid thus becoming even more cruel towards his subject. In effect people who rely on fear are usually incapable leader and will not make an effective leader since fear INCAPACITATES people thus the realm instead of empowering the land. Tyranny is a sign of decadence. It is the way for the inferior to impose themselves. It is how the fearful try to keep onto power. Surprise surprise the most fearful person in the land of tyranny is the tyrant himself. Afterall he has so many things to lose. He knows he doesn't deserve that power and makes a poor leader. He knows very well indeed. Maybe he doesn't want to admit it but he knows.
To try to hold onto power by imposing fear is like trying to hold onto an ever burning coal with bare hand which you lit and burn yourself. Sooner or later you will drop it.
Fear alone cannot rule, this much is true, but Cicero still with much power over the elders in the senate did not cover before Mark Anthony just because he had a record of war, nor did an entire populace subdue itself under Justinian after the massacre at the hippodrome just because he had charisma and wealth. The golden chalice in the center of the poor cities of Wallachia, were left untouched not because the people were prosperous, but due to the fact that in the past, he had raised a forest of pikes and impaled man, woman and child alike. Which caused a far larger army, that of the Ottoman empire, to turn not based in myth and legend, but the horrific sight the sultan himself saw. It is entirely correct that a record of fear alone cannot hold any position alone for long, as tyranny, is it's own cause for war, but history has proved that those who have justified their use if fear as a tool, can indeed curb vassals to their will. Even after the pretender king of England during the civil conflict under Henry VIII ended with the execution and appropriation of his lands, this did not spark the vassals, now given a reason to fear as Henry made clear, which would still combined have made Henry strongly disadvantaged had they united, never stood up to him. Not when the church was cast out which was immensely unpopular, yet profitable. Not when their own rights were curbed greatly in favor of his own, and he used fear as an effective tool in doing all this. He always held national trials, surrounded with more friends than enemies, to isolate those who would desire to stand against him, and make them feel hopelessly weak. Mark Anthony was both in Egypt and his short reign in Rome hated by the nobility. Utterly despised, but loved by the people no less. The latter, as well as his military reputation. *While not exactly Alexander the Great, he was known as a competent flanker, and had proven a great asset to Caesar in most of his major victories that challenged arithmetic itself* Held it together. When Ceasar was trapped by Pompey, and before Anthony leaving. There was effectively only one regiment keeping the peace in Rome, and it would have been a momentous occasion for either a rebellion or plot. Yet, neither was formed. For Mark Anthony had isolated the once proud senate to feel like mere puppets, useless old men that some argued they were.
To argue as you have that fear holds no place in rule stands incorrect. It goes against the principles of vassalage, caste, serfdom and indeed slavery. All institutions which required a hierarchical pattern and disproportionate distribution of power. The slave feared his slave master more often than he rebelled against him. The serf held onto his limited property even with his desires to expand curved more often than rise in rebellion. When a vassal desires something held by a liege, which has a great record, but also has proven capable of cruelty towards those who have acted against him. If said vassal is also stand to feel isolated, and hopelessly outgunned. Then he will not turn to open rebellion just like that because he feels miserable in life, he may stand more likely to turn to plot, but if an example has been made in the past, then he will bide his time until the liege seems weak. Certainly not a single province declare war upon an empire which spans half of Europe just like that. Such would likely be weak enough that the nearby vassals would be asked to pursue, and maybe claim some of the spoil once the traitor is hung. As far as games of fear goes.the Ottoman empire succession history proves itself to be a great example. Because it often resulted in the mutilation, killing, or at best permanent house arrest and castration of all rivals. A vassal who fails in rebellion can easily be branded a traitor, a black stain which at the time would extend towards his entire family and justify the appropriation of titles and claims should his defeat be ultimate. Certainly not merely imprisonment, where the equally disgruntled heir would stand likely to rebel within the next month stands likely. While benevolence, charity and generosity is indeed things which can help on a regular basis, they can equally quickly turn into appeasement which the game true enough punishes. But fear is a discouragement to trouble, and a competent spy network combined with fear is a discouragement to plots. Certainly more than benevolence on it's own stands as it stands a poor buffer to ambition. Yet in the greatest example of feudal rule, that of Charlemagne, while never short on wars, it would have been an auspicious time for plots, treason and rebellion. Yet Charlemagne combined both enlightened rule, competence and indeed fear over his subjects as he had dealt harshly with many whom not just acted against him, but displeased him in general. They knew he had a spy network, and stood capable of justifying execution, banishment and appropriations of titles. Not at a rate which directly threatened his own vassals who mostly were loyal, but enough to usurp the titles of brothers, family and indeed entire kingdoms beyond Francia.
While fear is just the largest factor in all of this, the most noticable issue stands when it comes the mindless rebellion. IE, single province vassals declaring war upon a popular emperor. I would argue this would never stand remotely likely or reasonable unless the vassal was extremely incompetent. There is no realistic effect of treason, IE, failed rebellion. If a king plunged the empire into a deep civil war, it would be seen as natural, should the king have lost, to pay with his life at the end of it. Not just the king, but his entire kin. There also stands very unrealistic move, IE, single disgruntled vassals in large empire that openly declare suicidal wars. There also is no system for the populace and their affection towards the liege. Nor is there any 'winds of change' for a ruler who has just accomplished something great. I once conquered a massive part of the Fathmid caliphate, and distributed this among mostly my family, but gave cities and such to deserving vassals, but lo behold - It would seem that mighty Holstein found it a good idea to rebel against someone, who would have been immensely popular based on accomplishments, and also, considerably feared due to his power. Certainly enough to quell one mere vassal out of fear.
Fear holds an inseparable relationship with the fedual era at large on all levels of politics, but it is also linked to power. A king will not fear a measly single-province vassal who might like to routinely abuse his court and may very well use it as an excuse to invade a tyrant, but at the same time, it stands extremely unlikely that the liege of Ferra would declare a war of independence just after the emperor had won a great crusade. Held a grand tournament ect and had a history of dealing harshly with traitors. A threat could give much the same effect as a gift in this game. Perhaps spark animosity sure, but just because a liege is disliked immensely with one vassal, do not stand reason for the lone vassal to suicidally rebelled. History stands filled with unhappy, yet perfectly controlled vassals. While bravery would of course limit the effects of fear, a brave vassal would be equally reluctant to suicide as a craven vassal, but in the contest of fear itself, a craven vassal would not rebel if he feared a his liege, but a brave vassal could if it had any hint of victory.