Seeing Mycroft watch Sherlock get beaten didn't really surprise or shock me.  (I was surprised to find out Mycroft was there, though.)  In another fandom I'm active in, the main characters are two men, who may or may not be cousins but act like brothers.  The older one is always letting the younger one do the grunt work, like Mycroft lets Sherlock do the dirty work and he stays in the background.  Also, in this other fandom, the older man watches, a couple times, as the younger one gets beat up in fights and he doesn't do anything to stop it; in fact, both times, he grins and is apparently enjoying seeing his partner getting whupped.  I was immediately reminded of those scenes when I watched TEH.  Come to think of it, in the other fandom, the younger man, after each beating, accuses his friend of not intervening and not helping him, just like Sherlock accuses Mycroft of not stopping things sooner.  We've discussed this extensively in the other fandom and have concluded that it's just a guy thing.