Urban warfare is like this, sometimes the two sides are less than ten meters apart, separated by a few walls, yet unable to detect each other.
You head east, I head west, and we just pass by each other, as if there is no desire for combat between us.
The Tang Army is clearing Dwarf soldiers from building to building, they can't blow up every building into ruins, after all, they're to occupy a city, not erase it from the map.
Clearing ruins to rebuild the city is extremely difficult; if the Tang Army doesn't want to create trouble for themselves, they can't use shells to turn the entire city into a wasteland.
There are still millions of Dwarf civilians in the city, if the city is leveled, it would also mean slaughtering these civilians—such accumulated hatred would only make the Tang Army's occupation of the Ice Cold Empire much more difficult.
