Sacred Haven of Debauchery

I haven't seen anything like this anywhere. And no normal, good kingdom would start such a practice, 100%!

A good kingdom wouldn't, but a practical one, populated by reasonable people, is quite capable of it, even if it's not the best course of action from a moral standpoint. And the fact that you haven't seen it is perfectly logical. Because in most people's minds, an undead army is only associated with "Dark Lords" (well, there are a couple of exceptions, but the undead aren't quite as simple-minded there). But from a logical point of view, it's possible.