I note that, in some sense, Frosty's interpretation is self-enforcing. If he says publicly that he holds an interpretation of "A treaty is a promise to do X, not a promise of compensation for not-X", then everyone knows that breaking a treaty with him is that much human badboy, from Frosty and from whoever agrees with Frosty's interpretation. And he can, of course, refuse to sign treaties with anyone who does not hold such an interpretation. (If it turns out that he needs such a treaty... well, that's life in international law! It's no joke living in an anarchic world without a sovereign.) And the other thing is, I don't think anyone holds a pure compensation view of NAPs; it seems to me that everyone views them at least partly as promises not to attack. And, as pointed out, if your word is not your bond, it will be that much harder to get the next treaty. Which is true even if you publicly proclaim a compensation view; a contract with someone who views the NAP as a promise is more valuable than a treaty with someone who sees the excomm as the only penalty, and consequently more sought after.
So, y'know, judge your treaties carefully and your breaches of them even more carefully. Jakalo has presumably sacrificed some credibility here; on the other hand he has gained a Middle East situation that suits him better. Whether that was a wise exchange is for him to judge, and he'll likely want to wait until at least the end of CK to do so, too.