I think the entire point is that right and wrong and good and evil are not a universal absolute. It depends on your perspective. It's the idea that in every war, both sides firmly believe they are right and they are good, always. The other side see you as evil and bad. When Dany is freeing slaves and destroying cities prior to this, we all cheer her on and see her as good, it's only when her values conflict with our own that we start to see her as Mad. I think her final conversation with Jon, the smile on her face, the excitement, and even her "evil speech of world domination" at the end was completely consistent with all her behavior up to that point. If Kings Landing was full of people we didn't know or relate to, the audience would see her actions as no different than what she did in prior conquests, and we would still be cheering her on. It the entire point of the story. It's only delusional if you are standing on the other side of her actions. Martin cleverly kept us on her side up to the end, and he shifted us to the other side slowly to turn her "mad". It's very well done. And Tyrion spelled this out quite clearly IMO.