While researching this topic I found another prominent general (William S. Harney) from my home state of Tennessee who served in the Union. Why exactly was he replaced from command? It says on Wikipedia (don't how true it is) that he kept MO from seceding, so I don't why Frank Blair would replace him with Nathaniel Lyon.
It was largely due to the fact that Harney was a southerner and Blair ( first) and Lyons (second) didn't trust him. Harney felt that the arsenal in St. Louis was adequately defended. Blair had Lyons brought to St. Louis to strengthen it's defences. Blair wanted some of the arms (10,000) distributed to the German immigrants, Harney refused to do so. This lead Harney to being recalled to Washington. He came back to St. Louis and allowed the arming of the pro-Blair Germans. He also came back with attitude of cooperation with Blair, but Blair was having none of it.
You have to understand the huge amount of political power the Blair family had in the Lincoln administration. Frank Blair Sr. was one of the founders of the Republican party. Frank Jr. was a newly-elected congressman. His brother, Mongomery, was post master general in Lincoln's cabinent. The Attorney General, Edward Bates, owed his position in the cabinent to the Blair's
Lincoln had his hands full with Union fallng apart and he gave Frank Blair Jr. an unusual amount of power and authority in handling the affairs in Missouri. As an example. Lincoln gave Blair the power to relieve Harney of his command when and if he, (Blair) thought it was time to do so.
What finally cost Harney his command was the Price-Harney Peace Agreement. The Federal Government would control St. Louis, while the Missouri State Guard would control the rest of the state. Blair, Lyons, and the Lincoln administration felt that they had to suppress the rebellion, while Harney was trying to keep it from occuring by letting things cool down.
Harney's fault was he was a moderate man in a time when radicals on both sides where driving the situation. How he was treated by Blair and Lyons (who had a terrible reputation for being insubordinate), was criminal. Harney was relieved of command by Blair, and spent the war at home, and never was disloyal.
Some of us here, myself included, feel that if Harney had had the support of the administration, the war in Missouri would not have been as horrific as it was.