I have one question about this character. This is pretty much the only character I felt bad killing since, well, he is minotaur and minotaurs are not the epitome of intelligence and since he was used as a tool pretty much and than tricked in one way or another. Since I am playing lawful good character, I am justifying killing Zor with the fact that he is dangerous and stupid so he'll maybe sometime and somewhere kill again.

So my question is, is it possible to spare Zor and complete that bounty hunt quest ? Since I know you need ear from all of them and I can't remember there was option to persuade Zor to cut his ear off and than spare him, my logic was that I maybe won't be able to complete the quest if I spare him.

No, unfortunately, it's not possible to both spare him and get his ear to complete the quest, only one or the other. I think I tried to do this on my Paladin playthrough, he simply left without me having the option to persuade him to take his ear.