I'm not sure what I would have done in this situation. It's tricky indeed. We just practiced in the sim, and if the ATC or the cabin crew reported fire or burning smell then we were expected to order emergency evacuation. Better to have a couple of people with very minor injuries during evacuation than people burning alive isn't it?
if the airplane had exploded for any reasons, everyone would have pointed fingers at the captain for not having ordered the emergency evacuation.