I slipped him a frenzy potion.
He pulled a knife on the little girl who sells fruit and veg, the entire town flipped their [censored], beat him to a bloody pulp, and as he lay begging for mercy trying to get back up to his feet one of the battle-born stabbed him with a sword finishing move from behind, which looked like he stuffed it up his backside all the way to the hilt... couldn't been scripted better even with the CS
As if this wasn't enough of a satisfying end, I went to the temple, and in there his wife was confiding in the priestess about how she hated how he treated her, the priestess cracked a joke about him maybe dying soon; to which she smiled. I knew right there and then it was the right thing to do ;p
I just managed to get this to work. Though, it wasn't quite as epic as yours. He just pulled a dagger and ran to the first person he saw and started knifing them. Then, when the potion wore off he just sheathed his dagger and walked away like nothing had happened.
So, I reloaded. Figured I'd take care of the bugger myself. I slipped him the Potion of Frenzy as well as a Potion of Something-or-other damage health and I ran to the front of him. He proceeded to stab me so, in my defense I shoved both of my ebony swords through his stomach before dropping him on the ground. I then proceeded to parade his corpse around Whiterun.
Guards would stop to say, 'Hey! Put that down!'. I saw his wife sitting on a bench near the Shrine of Talos and I dropped him on her lap. Then picked him back up and "shook'' him in front of her. Then I propped him up in front of her on his knees then beat him until a guard told me to stop; his wife also mentioned something about being a widow at that point as well. I picked him back up and carried him through the market showing people as I passed. I tried to throw his body over the wall behind Ysoldas' house but couldn't get him over it. So, I opted to throw him in the stream under the bridge by the main gate so I don't have to look at him anymore.