Ultimately, it is up to you whether you choose to spare Karadin or help Lambert kill him. There are no real consequences to the quest as Lambert will still consider you a friend, regardless of the choice.
Should I help Lambert kill?
You can choose either to spare Karadin or help Lambert kill him. Lambert will be angry with Geralt if you insist on leaving Karadin, but there will be no real consequences to the quest as it will not impact Geralts future interacations with Lambert. Regardless of the choice, the two will go on their separate ways.