All right. (Cracks knuckles) I'm a huge Iron Man fan, my favorite character, so I'll see if I can add some insight.
There are Iron Man discussion threads, quite a few in the Marvel section, but this is fine. He did kill those men with bullets.
Nope, Iron Man never has had or will have the same strict moral code as Batman or Superman for example where killing isn't an option. He gets the job done no matter what it takes. Its that flawed morality that Marvel breeds their heroes from, DC creates Gods that look down on humanity and save it while Marvel looks to humans who are given extraordinary gifts or talents but are still very human in their thinking and actions. Tony Stark has no issues with killing terrorists and so neither does Iron Man. There isn't a duality like there is with Batman/Bruce Wayne or even Superman/Clark Kent. He is still the same persona inside and out.
He could have, but Iron Man fights to save the innocent, he didn't see the terrorists as such and so used deadly force to defuse the situation as quickly as possible, he didn't want to risk missing or hitting one of them and not knocking them out completely which could have lead to them killing a hostage. Its like the police department, a friend of mine is going through the academy and they are told when they shoot they shoot to kill, they are told its their last resort but they are told that when deadly force is needed and evident to use it.
This is arguable. Its true that in none of his incarnations Batman has ever physically done the killing but he doesn't save which means he is allowing death to occur. In BB he doesn't save Ras, it saves the blood from being on his hands but it still leads to Ras' death which means essentially Batman is being Judge and Jury and allowing the natural momentum of the situation be the Executioner. One could very well argue that the firm knowledge that the man will die and the conscious effort not to intervene is unintentional manslaughter in the eyes of the law. Batman isn't a killer, but he isn't clean of the deaths either. In one sequence he is fighting thugs who are shooting and he grabs the arm and pulls it aside while he continues to shoot, he shoots another thug who dies, this is still by defintion an assisted killing at the very least. I get what you are saying because there is an instilled moral code in Batman and Superman that makes them seem heroic above anyone or anything else but Batman at least usually dances the line which makes him a deeper and more dynamic character IMHO.
Its their humanistic flaws that make them interesting and dynamic. Captain America for example would disarm and disable before killing, while Tony and Wolverine for example wouldn't, this creates tension amongst team members as well as colleagues and each doesn't understand the others points, much like real life. Many would say "Person A" is okay to kill if the situation warrants it, while "Person B" is not even if the situations are identical. Its those judgments and individuality that makes Marvel such a rich character driven company (well....it used to be) some of the best DC stories are when those Gods are dealing with real human emotions, problems and mistakes and there is a reason why. When Superman fails to save someone he internalizes the loss as if he personally killed them by not saving them, its one of his fatal flaws, while Batman choose who to save and not to save based on situation and intention of the person. Same moral code, different sides of the coin.
Stark while having an enlightening to his duties in life is still a businessman and wouldn't just give away expensive weaponry, one could argue why doesn't Batman just arm the citizens of Gotham with his toys and watch from the sidelines, the other side to that point is if the villagers don't know how to use it then it becomes a point of weakness for these weapons to be taken and still used to kill innocents. Stark wants to shut down the weapons division of Stark Industries by the mid film and use his armor as the last line of defense. Stark Industries like Wayne Enterprises has their hands in many different arenas, the weapons creation division is just the most moneymaking.
Terrorist breed fear, its their tool. Disarming them and allowing them to go away or be arrested or even be at the mercy of the villagers still keeps them operating. Much like Batman utilizes fear, Iron Man knew if he showed Deadly Force then the terrorists would understand and think twice about engagement. Its the old make an example ideal. Not the most ethical ideal but effective nonetheless.
Tony sees the errors in his ways but not to the point of looking solely to being a non lethal fighter. He sees it more that Stane was selling these to both sides and taking whatever money is green. He wants to remove the terrorist from his company's weaponry but he is still producing for the government. Nowhere in the film or in the character's lineage does it say he stops producing completely. He feels Iron Man is a watchdog of sorts, that if the tech gets into the wrong hands he can personally clean it up.
Tony Stark is a flawed human, he has dealt with womanizing, alcoholism etc all while wearing the suit. Its these flaws that separate him from the rest and make him more unique. Tony Stark could care less what people think of him, he does what he feels is right. Putting on the suit doesn't change his perspective like it does for other heroes who feel that their alter-ego should be a beacon of hope or a role model to the masses, he puts on the suit to "go to work" and get the job done. Then gets back to his billionaire lifestyle. While Batman looks at Bruce Wayne as a means to an end, a persona to put on so people do not get wind of his situation and a way to continue operations, in reality Bruce would love to get rid of the Bruce Wayne "character" and be Batman full time. Tony Stark doesn't see that duality, instead he just sees it as an extension of himself, flaws and all.
