My problem with the fears of those around her that she could "go mad" is, well, the mad part - In World War II the USA nuked two japanese cities, Japan surrended, and that was it. They didn't nuke Tokio out of spite. They didn't use the nuke in the cold war. They used a terrible weapon for a perceived greater good, and that was it.
As I said previously, let's say Dany targets specifically the Red Keep and burns down Cersei and all her allies. Some civilians die, maybe scores upon scores, maybe hundreds, maybe even a thousand. Too bad. But she gets the throne, she declares herself queen, and then she would just rule. What does Varys fear? that she finds out she likes it? that she goes "Well, I killed some people as collateral damage, I might as well burn people like my father and impose unjust taxes and have everyone's riches taken away to built lifesize statues of me and my dragons all along Westeros"?
Hell, not even Cersei is doing any of that, sure she uses human shields but she passes it up cunningly as a protective move, why would Dany using the equivalent of a nuclear bombing would mean she'd use nukes every time, in every circumstance?