Oh come on now. Let's be honest here. Lore's conversation and their ability to plot a way for them to eat the Enterprise, shows the CE is quite aware of what it is doing. It doesn't care about other life, it wants to feed to live. Whether that is evil or not depends on whether you're the whale or the plankton. As for whether Picard and crew knew, considering that they uncovered Lore's plot at the end of the CE's debut episode, they can deduce that the CE is sentient and what they were up to.
I know that the episode wants you to feel that the CE's destruction was wrong, but the episode itself is wrong. It's another Jelico moment. And I am wondering how many of them there are in TNG now. I can think of a few in DS9.
Actually, on Star Trek, I feel like the characters occasionally being wrong is a feature, not a bug. It's not (normally) an action show, or one with flawless superheros. The usual layout of a Star Trek show is a team of talented individuals, each with their own individual strengths and weaknesses, doing the absolute best they can to overcome new, difficult, and sometimes morally ambiguous challenges. 95% of the time, they get it right, but there is the occasional "whoopsie."
In the end, if we accept everything we saw with Lore conversation, destroying the CE was most likely inevitable, but I still feel that what was presented in the episode, with what each character knew at the time, Dr. Marr's actions were still wrong. What she did was the vigilante-style revenge murder of the creature before peaceful resolutions had been attempted. I would say that even in-universe, there would have probably been many in the Federation that agreed with you and Dr. Marr. I think it's supposed to be a little bit grey.