You are correct, everyone is a villain at that point. The problem with that, as horrible this is, is it incentivizes the action. For the same reason countries don’t negotiate with terrorists. If you prove that committing terrorist acts, or taking hostages, or using children as human shields works, you positively reinforce those acts. Its fucked up beyond belief, and all alternatives need to be exhausted, but at some level someone takes the responsibility for where the lines are drawn for the least damage in the long run.

Is it actually preferable to just give money to anyone who hijacks a bus load of people, or a plane, or a bank, etc, so that no hostages are possibly injured when that happens? It might be, and could be argued for. Is such acts becoming more frequent or commonplace because it works an acceptable price weight against innocent human life? Again, it very well might be. It’s only money. I am glad I am not the one making those decisions, but we can’t pretend that the calculus doesn’t happen and/or doesn’t matter.