She's not retarded, she's just ignorant of what all is going on. And making a retarded decision because of that ignorance.
There's a thread on reddit with people speculating that Korra could go to Zaheer for help, even if it only ended up being to talk and not the profoundly nonsensical idea of letting him out of prison to actually help directly. This was my favorite response to the idea.
"Sup Zaheer."
"Ah, Korra. A welcome sight in this dark cavern. Why did you come?"
"To talk about the Earth Kingdom that you beheaded."
"Ah. Well, as I said before, Korra - the natural order is disorder. Soon, all the world will..."
"It's a dictatorship."
"...Say what?"
"Yeah, turns out people didn't just revert to anarchy because you kill one Queen. Some chick showed up and reunited everything. It's an industrialized, conformist movement following the ideals of material progress and social unity. They have complete control of the populace and already began imprisoning those with differing opinions. It's the very antithesis of everything you wanted for the world and the exact opposite of what you predicted as a result for your coup."
"So....you want my help defeating her?"
"Nope, just felt like rubbing your nose in it. Let's call it payback for the mercury."
"You got to be kidding me."
"Nope. Bye!"
