Originally Posted by VincentNZ

Sure, could be, but even then the OP is correct in calling this out as a bug. Still I suppose you are talking about Tiefling kids not being attackable and not Goblin kids being attackable. The problem with having that option is that, while the game wanting to represent contemporary moral standards and also include being able to open a wide variety of choices, they do not offer the corresponding consequences. Does the killing of the Gobbo kids remove the option to side with the goblin camp? It should. It should also have several other consequences like companions leaving, quest givers not giving quests anymore, certain factions or NPCs being hostile on sight, restricting certain traders, increase trading prices and so forth. So it would reflect the consequences of the real world, they are trying to represent in a fantasy setting.

Contemporary moral standards don't apply in a fantasy setting.
To most people in Faerûn goblins are nothing more than dangerous pests, so most people would be ok with anyone doing pest control. Traders/merchants and travelers would more than likely be grateful that you've made the roads a little safer to travel.
And let's be honest ... if you're slaughtering them, you're unlikely to want to forge an alliance with them anyway.