His proposal is this:
Iomedae’s Knights of Ozem are, quite clearly, fighting a desperate war, against enemies that are really obviously not a faction the Empire would want to ally with. Aroden’s followers might also not be a faction the Empire can work with, of course, they are after all the followers of a god, but Altarrin doesn’t think it’s outside the realm of possibility. It’s a different world. Aroden is (if His teachings are true, which should of course be verified separately) a formerly human god. And His followers, at least the ones under Iomedae, are - Altarrin thinks - genuine believers in the cause of Civilization and its principles. A different flavor of it, of course, but you would expect that of people from another world whose main enemies are animated corpses and summoned Abyssal demons.
(And one way or another, the Empire definitely cannot afford to have Iomedae and her Knights as an enemy.)
They know more now, they’ve narrowed down the possibilities. Iomedae’s claim that Aroden could and would retrieve her soul and restore her to life has been borne out. The reason she didn’t return to Oris is almost certainly not because it’s impossible - since Altarrin has just confirmed the possibility of it from their side, and the magic of Iomedae’s world is definitely not less powerful - and there is another very obvious explanation, which is that she - and probably Aroden as well - are too busy, and not that she doesn't still see the Empire as her enemy. Currently her beliefs about the Empire are - likely just wrong, definitely strongly biased, the gods steered everything she saw.
Probably, at some point, she and her Knights will either lose (which would be a tragedy for the broader cause of Civilization, whether or not it impacted the Empire directly) or she will stop being too busy, and the Empire will have to face her and her god-steered beliefs, and at the point when they're at war and she's in a position to make the first offensive push, it's going to be much harder to correct that.
Altarrin proposes that the Empire instead act proactively. It might not achieve anything, but - in Altarrin's opinion, and he has some arguments to make his case - it's not risking all that much.
One: they have Iomedae's sword. It's among the artifacts they studied. It's...not useless to them...but the artifact itself doesn't give its wielder the skill that Iomedae has, and they haven't figured out how to make it glow and move impossibly fast, that's probably a repeatable-miracle granted by Aroden. They're learning less from it than the others, and even if they could replicate it - which they probably already have enough notes to do, if Aritha masters the trick of it - they mostly can't take advantage of its full powers. Iomedae can.
Two: he's noticed something about the magic of Iomedae's world. He had half noticed it already, just scrying her during the war in Oris, but it came fully clear to him when he was observing her fighting the animated-corpse army (and also wearing her headband.) Their spells are absurdly powerful, but - apart from the ones that are ongoing effects - they take time. Multiple seconds. (Usually the same multiple, which is bizarre in itself.)
Three: Gates are a lot faster than that, at least if Altarrin is the one casting them and has no intention of personally crossing. And he is quite sure that Iomedae, and her Knights, and even Aroden, have no idea that he can do this at all.
Altarrin's proposal is that, the next time he manages to scry Iomedae at her camp - and he would rather try to fit this before she's left, since they've already observed that she can spar for twenty candlemarks a day straight and it looks like the animated corpses don't require sleep, but of course Bastran should take the time he needs to decide -
- that he raise a Gate to a hundred yards above her, and drop through the sword.
With a letter tied to it. They know Iomedae has translation-magic, even if she can't speak the language, and - the Empire should make it clear that this is their doing, an offer that they're extending to help if Iomedae agrees to leave Oris alone. That they'll consider offering more than that - not just her remaining artifacts, but perhaps even lending some mages - if Iomedae is willing to offer more in return.
(...They could maybe also attach a bag with the artifacts that are so far useless to them? The ring that doesn't seem to do anything and the stones that orbit a person's head and may or may not need to be instead embedded in their ribcage to work seem like two options that will minimally cost the Empire to give up.)
Altarrin is fully aware that this is a gamble that might not pay off. He might even be wrong (though he doesn't think so) about it being enough to bribe Iomedae not to help the rebels in Oris again. But it's not that expensive and he thinks it's worth trying.