About your Vale economic plan, wouldn’t be more sensible for the Lord of the Eyrie to create a stable & lasting alliance with the mountain clans as opposed to trying to crush them using knightly force? After all allied mountain clansmen can make a landwards attack on the Vale an even bigger nightmare for the attackers than it is currently, and some sort of resource sharing scheme with them might allow the Valemen to expand into the interiors of the mountains and their untapped resource bases.

It’s not a terrible idea, but there’s an underlying problem of thousands of years of guerrilla war and vicious reprisal, as well as the fact that the lords of the Vale are occupying land the mountain clans believe belongs to them.  It’s an imperialist/colonialist setup, and there aren’t many historical examples of that ending well. 

You might be able to divide and rule, set some of the mountain clans against the rest, and then forcibly relocate the mountain clans down into the flatlands to be put to work and assimilated into the dominant culture – essentially following the Welsh dynamic already extant in the Vale. But even then, you’re talking about colonial warfare and the attempted obliteration of a culture.