What this means (And perhaps it should be reworded so as to be clearer) is that each Noble shall govern his/her own holdings as they see fit. For example: On Melysa's holdings, the punishment for theft is the loss of the offending hand. While this may not be the same for Duchess Brisby's holdings, the Council will not interfere with such affairs as they do not concern anyone but the people of that particular holding.
The purpose of the council is not to take power from or otherwise hinder what the Nobility is able to do within its own holdings, but to act for the betterment of the highlands as a whole. With the forsaken and the syndicate being a threat, the council may vote to assemble troops from each holding and go to battle. They may vote to construct and staff a public school or academy for the betterment of the people. They may also vote to work jointly in the rebuilding of villages, homes, etc. It is not about power, but about rebuilding a broken Kingdom and offering the people a better life.
Edit: Maybe I'm just an eternal optimist, but such a council should promote people working together to solve the problems of the highlands. Then again... Whenever Nobles gather, there tends to be a lot of squabbling.
The RP that you are describing sounds quite fantastic. A bunch of powerful people gathering and voting to decide where to send their own armies, where to build a school with their own resources, where to rebuild a village.
However, that isn't what Hellissa has outlined before now. Not even close. What you are describing is just some fraction what has been put forward in the forum posts. You do not need anyone called regent to do what you are writing about there, you certainly don't need to implement new laws. What you are doing here is governing some sort of nation - the title of regent implies that it is the nation of Stromgarde - but the reason for the questions is that I wasn't quite sure what it is that you are governing. You seem to stop short of outright saying that his council has the ambition of outright ruling Arathi - probably for very understandible reasons that such an ambition gets one a lot of hate on an OOC level.
However trying to 'half-sorta-do-it' creates a council whose purpose is.... Probably exactly what Melysa described, but with this strange, almost childish layer of pretending
to be the leaders of the kingdom added to it.
I say pretending because:
On the IC level, Hellissa has done her best to make it clear, only the people that recognize the regency can 1.) be involved, and 2.) be "governed".
What that tells me is that on an IC level, (assuming her laws were passed to protect peasantry and let's for hypothetical purposes say that before her the 'old laws' gave nobility the power to do whatever) Alez could walk into Stromgarde, !@#$% slap the closest peasant to Hellissa for no reason what-so-ever, and then tell her that he doesn't recognise her rule therefore by her own agreement he should be judged by the old laws. Then she, if the above quote is accurate, would have to respect that. Not because I am being a jerk and I hate your RP - but because Alez doesn't recognise her rule and as such is free to act by his own laws. Unless, of course, she is liar and only said that to reduce hostility but really will persecute anyone who goes against said laws. Which, I suppose, is a possibility.
Is the above paragraph accurate? If so, do you see how it pretty much gives characters (not players) the choice of what they follow and as such make that pseudo-ruling layer you have added completely void.
I'm not trying to attack you, because truly I understand why you have felt the need to stay on this careful, safe side for the sake of not stepping on the very shaky nerves of the average RPer. What Melysa's paragraph seems to outline is a good less extreme option. What you seem to want to want to outline (but stop short of doing) is the attempt at outright ruling of the Kingdom of Stromgarde. This is the other more extreme option which -will- make Hellissa many enemies but, at least, it will be more practically viable in the 'imaginary sense.'
Of course, if your actual objective is to do what my theoretical paragraph describes - it will be safer and it will practically be what Melysa is suggesting too... But it will, in my opinion, also make Hellissa look fairly silly as a person who on top of helping the highlands wants to pretend to play ruler without actually making any enemies.