Z has his own Revolution inside the Rice Pot. Dark side exposed or made visible to the conscious mind. It has to work that way in order for Shinsu black hole skills to become unlocked. It is about incorporating the shadow self and emerging as a transcendent being. Z's rivalry with V feeds his inner monster. To make matters worse, the girl he has a crush on chooses V over him. This rejection traumatised him in the same way as with Traumerei. Thus converting him into a control freak and power hungry tyrant. Once all possible reconciliation with Arlene and V becomes impossible, only goal left to pursue is absolute power.
Perhaps Arlene choosing V over over Z had to do with V's rejection of the IC? We know now that the IC also helped dull or reign in the negative emotions or rather emotions regarded as "weak"; compassion, empathy, guilt, remorse. Maybe she noticed( just like Ameuz) Z changing so much over time and she didn't like that.
Who knows, for the sake of drama, perhaps Z and Arlene were initially into each other and the IC had a lot to do with their falling apart. We also know that both had similar earrings.That would somewhat vindicate Zahard, although only ever so slightly.
Gustang himself said that V was the absolute worst person ever. Maybe he was a homewrecker?
