Monsters also have their own cultures and sentience. Both the literal and metaphorical monsters. That doesn't stop them from being monsters.
Yea good point, a really good example of morality among monsters is The Witcher universe which separates the sentient but good creatures from the sentient but evil ones. There is so much nuance on the monsters and their types that you discover that many of them are misunderstood and have redeeming qualities making siding with them an intelligent and sometimes evil maneuver. In Act 1 Goblins are represented with no redeeming qualities (except laughing at Volo) that the "new" fantasy stories like The Witcher (or 5e Dnd) would bring forth. Drow got a pass back in the day and became beloved by players because they had an awesome character representing them but they are still inherently evil but here they are supposed to be in control but also being controlled at the same time so it's a difficult narrative to work with motivation-wise. If we are going to make goblins as beloved as they are in other fantasy universes and for similar reasons we have to make their leaders smarter, or at least more willing to listen to a good plan, having Minthara this static quest giver is just awful not to mention the fact that only Dror Ragzlin tells you directly to go to her. Big oversight here.
I saw someone comparing the goblins to chimpanzees which is accurate except they are endowed with this sentience, personality and life for the first time in a DnD game and it just feels a bit awkward and haphazardly done. In sword coast legends (a recent but failed DnD game) you are introduced to a group of ratmen living in the sewers and they will give you some great rogue gear if you stop the city from exterminating them. I think a solution like this for the grove v. goblins issue where you stop the grove from being attacked and negotiate the release of Halsin with Minthara, explaining that wiping out the druids grove is reckless and they should just wait to ambush the Tieflings on the roads and then attack the grove (perhaps you could go and falsely claim you had gotten them safe passage from the gobs).
It would make the goblins a more compelling choice that makes a lot more sense and go along with the newer idea of the goblins as a chaotic, but still sentient race who can be controlled rather than just random baddies to fill dungeons and do dumb stuff. This could still follow with a battle on the road and sneak attack on the grove and of course, a concluding goblin party and sweet drow lovin' but you would already have persuaded Minthara that you are worth keeping by hatching this dastardly plan. OR you could turn her plan around on her and replace her.
Also I found the lack of a neutral solution a bit disturbing considering we are dealing with druids here who are inherently neutral (except shadow druids).
But to get at the question here, yes it is wrong to kill innocent goblin children, the problem is that the only innocent ones are orphans or ones that have turned against their race and traditions. I find this argument so compelling and a part of why fantasy has made a come back, these moral quandaries are infinitely relatable to the human situation. But DnD games are known to be on the lighter side of fantasy and considering that no other computer game has attempted something like this in the DnD universe and done it well I give Larian credit for going all out on the design of the baddies, I just want some more complexity in their motivations and actions I guess.