I'm not sure if Iroh hasn't realized that we're in an extremely precarious situation where Ozai could decide we're not worth risking keeping alive, or if he's trying to help us in his own way.
While with the way the quest is going on anonkun I doubt we'll ever side with Iroh completely and realize "hey, an aggressive war of expansion just makes everybody worse off," we're far closer to him than Ozai by virtue of the fact that we're only slightly insane, and understand things like ethics and family and human emotions. And that's not great for our long term survival.
See, it makes us a threat to Ozai. He was willing to let Zuko run around with Iroh in canon because, I think, Zuko was a bit pathetic and honestly just no threat at all, and Iroh lacked the cruelty or ambition to use him as a tool to take the throne. We, on the other hand, are perceived as brilliant and ambitious. Maybe not as inherently talented at firebending as Azula, but we make up for it in other ways. Even without us associating with Iroh, Ozai no doubt views us as a potential political and literal threat* in a way that canon Zuko never was (at least until the end I guess, but by that point Ozai had jumped off the deep end). Hanging out with his hippie older brother won't earn us any points in his book, so we'll have to play this cautiously.
*Erroneously, of course. The true threat to his reign is Table-Kun.
...As an aside, kosm, I really hope you consider making our family's hereditary insanity a legitimate plot point for Akane in the future. Not because I want us to go Full Azulon, but because I like the idea of it becoming a problem and Akane desperately seeking a cure, or at least a way to mitigate the effects. Pathos is great! Suffering is great!
And great deal of waterbending involves changing water into ice and back; it's manipulation of temperature, something that firebenders can accomplish more easily. Even the reduction of temperature isn't impossible for the most skilled firebenders. The Fire Sage who authored the treatise goes so far as to postulate that, because all things can theoretically become colder, all things must contain some degree of warmth - and, therefore, fire. For a firebender of sufficient, transcendental will, it should be possible to bend anything at all. According to this Fire Sage.
"I remember when it was published - Ozai and I both must have read it a hundred times," Iroh continues. "It was quite popular with the nobility for a few weeks. Everyone was trying to bend steam or boiling water, to prove that their firebending really was universal." He chuckles. "Not that anyone would admit it when they failed. Unfortunately, I'm not sure that anyone ever managed to verify what the Sage believed."
I am thoroughly amused by the fact that, even after bragging about the Waterbenders being less proficient at manipulating heat and taking that as a sign of Firebender superiority, people who read the text ultimately proved to have no proficiency at the inverse.