You can't blame him for things he doesn't know about.
Also, even if he did not give it to them, he still tolerated them. The grey quarter has been a part of wind helm since before the dunmer came, leading me to believe that it was once As good as the other quarters in the city. So wtf did the dunmer do to them?
Actually before the red year the grey quarter was known as the snow quarter and only had nords in it if you believe npcs in windhelm.
If by leader you mean Tullius. Yes. If by leader you mean Titus Mede II. Yes. If by Leader you mean the ones actually controlling the policy of the empire? No. Besides Ocato, I can't recall a single council member who wasn't a greedy selfish jerk.
...Except we never really saw more of the elder council beside Ocato, Jagar tharn and whats-his-face in skyrim.