They stipulated that he should lead a communal du‘aa’ and not place one hand over the other; should he lead them in prayer or leave them?

Firstly: 

We appreciate your keenness to do good, follow the Sunnah and avoid that which is contrary to it; we ask Allah, may He be exalted, to enable you to do that which pleases Him.

Secondly: 

We should differentiate between that on which the scholars are unanimously agreed that it is a reprehensible innovation (bid‘ah) and that concerning which the scholars have differed, such as about placing one hand over the other when standing in the prayer, du‘aa’ following prayer, Qunoot in Fajr prayer every day, and so on. 

So we should be more strict in objecting to the first type (that concerning which there is scholarly consensus that it is an innovation); objections to the second type (that concerning which the scholars differed as to whether it is innovation) should be of a lesser degree. In fact, one may refrain from objecting altogether and keep quiet about it because there is such a difference of opinion concerning it. 

See the answer to question no. 70491 for information on differentiating between issues concerning which the one who acts differently should be denounced and those concerning which he should not be denounced. 

We should also note that Islam came to achieve and complete that which is in people’s best interests and to ward off and reduce that which is harmful to their best interests. 

In the event of a conflict between achieving something good and warding off something bad, we should see which of the two is more important and then give it precedence. 

Based on that, the Sunnah confirms that the hands should be placed on the chest when standing in prayer, and the Sunnah is to recite dhikr audibly following the obligatory prayer; each worshipper should recite it audibly on his own, then if he offers supplication (du‘aa’) after reciting this dhikr, he should do so quietly on his own. 

What they are calling you to do is not good and is contrary to the Sunnah. 

But should you refuse to lead them in prayer so that you will not end up doing something that is contrary to the Sunnah and committing this wrong practice, or should you agree? 

The answer to that is as follows: 

If your refusing to lead them in prayer will result in their bringing an imam who is more able than you to make these people follow the Sunnah and teach it to them, and he will not end up going against the Sunnah, then you should refuse. 

But if your refusal means that they will bring an ignorant imam who will do these actions that are contrary to the Sunnah and add many more to them, and he will not teach the people the Sunnah or adhere to it; rather he may oppose the Sunnah and those who follow it, out of ignorance on his part or because he is following his whims and desires, then in that case you should not hesitate to agree to be an imam for these people, even if they make you do these actions that are contrary to the Sunnah, because that will lead to less negative consequences than if you refuse. 

We stated above that Islam came to ward off and reduce wrong practices. Moreover, if you develop a close connection with them later on, then you can try to teach them the Sunnah and lead them towards it little by little. 

You can also tell them about the views of some scholars whom they respect who spoke against what you want to denounce of innovations, so long as you do that gradually so as not to alienate the people. 

There follow the views of some scholars about the imam refraining from some things that he thinks are Sunnah and mustahabb, so as to soften the hearts of the congregation. 

Shaykh al-Islam Ibn Taymiyah (may Allah have mercy on him) said:

If the imam thinks that something is mustahabb and the congregation does not think that it is mustahabb, and he refrains from doing it for the sake of unity and harmony, then he has done something good. An example of that is Witr, concerning which there are three scholarly opinions, one of which is that it can only be three continuous rak‘ahs, like Maghrib, as is the view of some of the Iraqi scholars. The second view is that it can only be one rak‘ah that is prayed separately from whatever comes before it, as is the view of some of the Hijazi scholars. The third view is that both are permissible, as is the prevalent view of the Shaafa‘i madhhab, Ahmad and others, and this is the correct view, however they favoured the view that it should be separate from what comes before it. If the imam thinks that it should be separate but the congregation favours the view that Witr prayer should be done like Maghrib, and he goes along with that so as to soften their hearts, then he has done well, as the Prophet (blessings and peace of Allah be upon him) said to ‘Aa’ishah: “Were it not that your people have only recently left Jaahiliyyah behind, I would have demolished (and rebuilt) the Ka‘bah and made its door level with the ground, and I would have given it two doors, one through which the people could enter and one through which they could exit.” But he refrained from doing that which was better in his view lest he alienate the people.

 Similarly, if a man thinks that the Basmalah (“Bismillah ir-Rahmaan ir-Raheem”) should be recited out loud but he is leading in prayer people who do not think that doing so is mustahabb, or vice versa, and he goes along with them, then he has done well. End quote. 

Majmoo‘ al-Fataawa, 22/268 

Shaykh ‘Abd al-‘Azeez ibn Baaz (may Allah have mercy on him) was asked: 

Is it permissible to refrain from saying Ameen out loud in the prayer and not to raise the hands? 

He replied: 

Yes, if he is among people who do not raise their hands or do not say Ameen out loud, then it is better not to do that, so as to soften their hearts and be able to call them to what is good, and so that he can teach them and guide them, and so that he will be able to teach them the right way. That is because if he differs from them they will find that objectionable, because they think that this is the Islamic way, and they think that not raising the hands, apart from the opening takbeer, is the Islamic way, and they have been used to that all their lives. The same applies to not saying Ameen out loud, which is the subject of a well-known difference of opinion among the scholars; some of them say that it should be said out loud and some of them say that Ameen should not be said out loud. According to the hadeeth, the Prophet (blessings and peace of Allah be upon him) raised his voice, and according to other hadeeths he said it quietly. Even though the correct view is that Ameen should be said out loud and it is something mustahabb, and he will be omitting something mustahabb in this case, the believer should not do something mustahabb if it will lead to division, dispute and fitnah; rather the believer should refrain from doing that which is mustahabb in that case. For the one who is calling people to Allah, may He be glorified and exalted, if his refraining from something will serve a greater interest, then he should do so. An example of that is when the Prophet (blessings and peace of Allah be upon him) refrained from demolishing the Ka‘bah and rebuilding it on the foundations of Ibraaheem. He said: “Quraysh have only recently left kufr behind,” and it is for that reason that he left it as it was and did not change it, in the public interest. End quote. 

Fataawa Shaykh Ibn Baaz, 29/274, 275 

And Allah knows best.