Ainz *did* say the sword would be good for powering up someone in the village, and he has Lupis Regina protecting the "important" villagers so
Yes, you might have missed some of the more subtle clues or implications but that's kinda to be expected when dealing with this type of storytelling for the first time or so xD
No spoilers, I'll let the ride be the ride and if there's confusion at the end try and help explain, for now we continue!