Let's start with the relevant rules (YS173):
Effects:
Emotion-Touch. If you can touch someone, you can make him feel something. You’re able to do maneuvers at +2 to your roll (using Intimidation for anger or fear and Deceit for every other emotion) that force an emotion on a target (as a temporary aspect), so long as you’re in the same zone as he is and you can physically touch him. The victim defends with his Discipline. You may be able to prevent the victim from taking other actions as well if you do this as a block (page 210) instead of as a maneuver.
So you can do maneuvers, placing aspects. These aspects let you then invoke them for a bonus or compel your target (technically invoke for effect as all compels are done through the GM, but that's just semantics). Any compel must past muster and be considered reasonable by the table, as with any other compel.
So, to answer your first question: No. Incite Emotion (without any of the upgrades) is not a maneuver only ability. It can block too. But it is limited ONLY to Maneuvers and Blocks.
If you wanted to attack, you would need to purchase the Lasting Emotion effect for an additional refresh.
Lasting Emotion [–1]. If you increase the refresh cost of this ability by 1, you gain the ability to do Emotion-Touch as a mental attack instead of a mere maneuver or block. If such an attack hits, you gain a +2 stress bonus on a successful hit (as though it were Weapon:2), increasing the chances of inflicting a mental consequence (and thus, a more lasting emotional state). The victim defends with his Discipline.
With this, you can make permanent changes to characters by forcing them to take consequences (including extreme) or taking them out (possibly making them your permanent lust slave as a taken out result, like many in the Raith's household staff).
In Grave Peril, Thomas would have been using Incite Emotion as a block (and possibly maneuvering or invoking existing aspects to make this block more effective). Thomas has the upgrade "At Range" which lets him use Incite Emotion on targets up to one zone away without touching them (it costs another refresh).
