Then they play chicken. If they both kill the townie, they draw the
game. If they both kill each other, they both lose. But if either is
the only one to target the townie, they've handed the game to their
opponent. That makes the choices Draw/Lose, and Win/Lose. My money's
on "Both discuss the matter after end of day and decide to kill the
townie, but both then betray each other." Town wins, you and me along
with it. In a game where that wasn't supposed to happen.