The best way I can think of explaining this is with Teddy Roosevelt’s quote “speak softly and carry a big stick.” Someone who can wield a sword but chooses not to. A person that people respect, but know not to cross him/her because they’ll regret it. What would be the adjective to describe someone like this?
The closest one I know is iron fist in a velvet glove.
An iron hand/fist in a velvet glove: used to describe someone who seems to be gentle but is in fact forceful and determined — Cambridge English dictionary
I would call such a person -- one who would use power only if necessary -- judicious. From M-W:
judicious: having, exercising, or characterized by sound judgment
A judicious person would certainly be worthy of respect and, when necessary, fear.
The answer you are looking for can be characterized in one word, "Meek". The modern translation of the word "Meek" is bad, it should mean along the lines of a warrior with a sword that he knows how to use but keeps sheathed. Instead it is translated to mean someone weak and powerless. If you are weak and powerless you are no good to anyone. If you are powerful but controlled, you are virtuous, honorable, and dignified.