Legitimacy would be ‘perfect’ if the actions of a representative (the government) were identical in both priority and content to the preferences of the individual. Legitimacy is neutral if the preferences and priorities are unobjectionable. Legitimacy is lost when the preferences and priorities are actively unwanted, despised or damaging.
We can consider tyranny an absolute moral concept. Or a praxeological concept. As a praxeological concept, tyranny is the use of property (resources) to accomplish ends using means that we disagree with. Since there are three economies we operate within: the material, the normative, and the signaling economy, the chance of tyranny increases with the heterogeneity of material economic, normative economic, and signaling economies. As such tyranny is less likely to be expressed in a small homogenous society, and more likely, if not mandatory, in a large heterogenous society. This is one of the reasons that small european states preserved individual liberty, and consequential economic experimentation and innovation, while the competing civilizations, most of which were older and wealthier, were left behind by the competing disorganized european micro-states.
As libertarians, it is useful to use praxeological analysis (the study of actions and transfers) rather than to stick with imprecise use of dogmatic first principles. Those first principles are useful because of their generality and wide applicability, but imprecise because of that generality. General principles, rather than causal explanations, may not inform us as to what insights and actions can actually help us achieve our objective: freedom, rather than simply whine about it.