First off your “first off” is wrong on all counts. They aren’t just machines, they can breed with humans, they clearly are another culture (they have a religion that none of the humans have) and possibly race.
The virus probably wouldn’t have insured their survival. There was one big gaping hole in the concept of the virus, it all ran under the assumption that the resurrection ships were all within resurrection range of some other resurrection ship all the way back to the Cylon home world. Any R-ship that wasn’t close enough wouldn’t have gotten the virus. It would have wiped out the pod that was currently harassing the fleet, but really it’s unlikely to have taken out the whole race.
You should always ponder something like genocide. Remember, that’s a large part of why we dropped the bomb, because we figured that was about the only way we could win the Pacific front without committing genocide.
Nobody is saying they don’t have the right to defend themselves. But is genocide ever really self defense? That’s the question.
Moral clarity can make for boring drama. Interesting drama asks hard questions of the viewer. IMHO I think they should have released the virus, for all the reasons you point out only without the needless venom, even if it didn’t wipe out the Cylons it was a good counter attack. But I don’t think it’s an easy decision, the Cylons AREN’T just machines and even a probably unlikely attempt at genocide would kill many millions of them. Killing many millions of anything sentient is a thing worth considering deeply. Truman didn’t just say “heck yeah drop the bombs” he thought about it long and hard, and those bombings didn’t even kill a 1/4 million.
There’s drama in the thinking. Maybe not a kind of drama you enjoy, but there is drama there, and there’s nothing wrong with enjoying it.
When the threat to your survival is sufficiently large (as it is when there are only 50,000 humans left), yes. Pondering the morality of war is a luxury that people not facing extinction have. It's one of the reasons why the behavior of the characters in the show often rings hallow. They frequently act like the don't really care if humans make it or not and that's a pretty standard leftist world-view, that it doesn't matter which side wins.
As Patton observed (in 1930), "War is not a contest with gloves. It is resorted to only when laws (which are rules) have failed:" I highly recommend this essay.