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Alright, It has been established as canon that the Jedi Council has been held accountable to the Galactic Senate for a period of time between 25,000 and 10,000 years BBY. We also know that that that the Jedi council serves as an advisory body to the Supreme chancellor.

That being said, 4000 years before the battle of Yavin, the Old Republic fought in the mandalorian war. It seems the mandalorians (from what I've read) acted like the the scourge of Ghengis Khan. It took pillagings of several worlds before the Republic got involved. Now you might think that the Jedi would be obliged to get involved seeing as they are accountable to the senate, also as advisory council, and as well as being a quasi-military arm of the Republic's judiciary. But they didn't. What is even more puzzling is that they banshed Jedi who actually served as military leaders within the Republic's military in an officially sanctioned action by the Galactic Senate.

Why were the Jedi allowed to sit out of the war and why were they allowed to throw out members who fought in the war?

Because they were cowards who deserved to be wiped out. They quietly left millions to die rather than get their hands dirty.

They apparently aren't directly controlled by the government, so they weren' forced into service. And since they police their own, they were allowed to toss out those did join the war effort.

The irony is that if Revan hadn't acted, there would have been no Jedi Council left to condemn her.

The Sith might get a bad rap for not be as noble as the Jedi, but at least you can count on them when barbarians invade your lands.

The Jedi of that era had a surprising amount of autonomy and apparently could not be forced into the war by the Senate.

And the Jedi Council only banished one Knight: the exile. Except for him/her, all the Jedi who followed Revan and Malak to fight in the Mandalore Wars stayed with Revan to fight the Republic in the Jedi Civil War.

KOTOR2 SPOILERS The exile was banished largely because the Council was afraid of what he/she had become after destroying Malachor V. They didn't understand it and they feared it. Because the exile returned to them in the middle of the Jedi Civil War, the only thing the Council wanted was to make the potential problem that the exile represented go away so they could concentrate on fighting Revan.

Trogdor wrote:And the Jedi Council only banished one Knight: the exile.

Only because he was the only one to come back.

True enough, but it's debatable what they would've done if a normal Knight who'd fought in the Mandalore Wars with Revan returned then. It's possible that they'd have kicked him out for disobeying their order not to join the war, or they might've been desperate enough for more Jedi to fight Revan with to allow him back into the Order. Probably the former, because they'd suspect this hypothetical Jedi of being a spy like they did the exile.

Trogdor wrote:The Jedi of that era had a surprising amount of autonomy and apparently could not be forced into the war by the Senate.

I can understand sitting out the war. But to take such an action as banishment is a bit to extreme if you take into consideration the fact that the Jedi Council only exists at the suffance of the Galactic Senate and it's Chancellor.

Bear in mind that KotOR takes place one *hell* of a long time before the movies; They appeared to be allowed to pretty much do whatever they wanted back then. Remember that the entire remaining order appearently upped sticks and left without leaving the senate so much as a fridge magnet after Darth Nihilus appeared. I suspect the more subservient Jedi Order seen in the PT resulted because of the Jedi Order's virtual destruction between KotORs 1 and 2.

Also bear in mind that the Jedi Civil War dealt an almost lethal blow to public opinion concerning Force Users; I'd expect there to be a public outcry for more regulation of the mercurially-tempered Order after the war was over.

Edit: Edited for clarity.