Well I think you're assessing good and evil based on your own moral compass rather than how RPGs base them on. Someone who is apathetic is neutral because they could go either way, it makes no difference. It's the definition of neutral. Evil is going out of your way to cause harm, Good is going out of your way to help. Why would a neutral person kill a village of people? They'd need a reason. Soldiers have slaughtered towns and villages on orders but each soldier didn't have an active desire to be part of that. They aren't inherently evil, maybe they think their cause is just. They were told to and had no resistance to it. You can do evil acts without being evil.

Neutral is the absence of compulsion either direction. It's killing a guy because they had it coming one day and feeding orphaned children the next. It's a mix of good and evil to where you are conflicted to call them either a hero or a villain. Something from Fallout: New Vegas does a good job of explaining it.