Just for another perspective, I thought it was more like shock. Not because the situation had broken him, but because he did want Blockbuster to die, but also didn't. The thing that bothers him isn't that he wasn't able to stop her but that he didn't stop her, I thought. So I always read the scene as Dick barely being present in his body, almost like an out of body experience.
I saw the passivity carrying through--once he checks out to be able to have Blockbuster dead through his inaction (because no matter how much he believes it's wrong he wants it--the reason Tarantula's able to kill Blockbuster is that Dick actually does want him dead too) he's still out of body for whatever happens next, which is why he isn't able/doesn't fight back.
So I guess for me I did see credible story justification for both. I didn't really see it as breaking, so much as a way of dealing when he was that conflicted. He is completely isolated to set up getting him to that point. But I didn't find anything unrealistic about somebody not protesting or not moving. I would imagine that has happened to people. It wouldn't normally happen to Dick or a superhero--that needs explanation. But like I said I saw that explained. So that specific part of the story never bothered me.