Much of philosophy is case studies of extremes. I don't think the benefits of stoicism, for example, means that any real human should act as a strict stoic.

Rather, philosophical debate is to me, a means of assessing the two ends of a sliding scale, and giving us tools to decide how far we want to stand on various scales of human behavior.

In this case, of course you don't endlessly forgive an aggressor. Doing the same thing and expecting a different result is insanity, as the saying goes.

I think the important point of this is to realize that if you want to reverse a situation with two bad actors, then somebody needs to forgive. That people are dynamic, and if you do have the leeway to be generous and give a second chance, then you should consider whether there is a reasonable possibility of the other person reciprocating in kind. Key point being like you said -- whether the bad faith behavior is highly predictable.

Just as generations of Japanese cannot forever hate all Chinese or Americans, or Jewish and Germans, or Americans and Russians.

Applies to things like romantic relationships as well. Everybody starts off with an open heart, and closes off if they are hurt by someone else. But you can either stay closed off and in pain forever, or allow yourself to be vulnerable in the hope that the other person reciprocates.