War is a horrible horrible thing, and unless you have fought in one, I don't think you can truly understand the meaning of those words. Watching war movies, reading novels, playing FPS, or immersing yourself in media reports such as this can't give you enough perspective to make a sound judgement, let alone second guess the actions of those who have been to war... and yet, that's the responsibility we all have as citizens in our Republic. A difficult contradiction to have to resolve, so let me give you my perspective before you decide.
This video is now several years old, and as such, I don't think we'll ever know what was really happening on the ground and why this group of men formed up. To my trained and experienced eye, it's obvious that some of the personnel on the street were armed (I saw 1 rifle and 1 RPG), that there was a US patrol in the vicinity, and at approximately 4:00 min in the video, one person with something dark and tube shaped in his hands is peering around the corner of the building in a kneeling tactical stance (what you would expect a person getting ready for an RPG shot to do). The pilots call out what he's holding in his hands as an RPG. In that moment, and in that context, it certainly appears to the pilots that this group of people is setting up for an ambush. Now, was the guy peering around the corner holding a camera instead of an RPG? Even to my eyes, it's hard to be sure. A better question as Wumpus points out is: if that was the photo journalist, what was he doing hanging out with the guys with guns, and why was he peering around the corner of the building, down a street, with a US convoy in the area? Was it hostile intent or simply poor judgement to do that in a war zone?
It's perfectly understandable why someone unfamiliar with the insurgency in Iraq/Baghdad around 2007 might watch this video and question why an armed group of people strolling down the street mid day should be attacked. I would ask you though, what do you think an ambush looked like? What do you think terrorists and insurgents look like? That's right, more often than not, they looked something like this. Indeed, do we know this wasn't an attack that was preempted by the pilots? The assumption Reuters (and wikileaks) would like you to form is that because their journalists were on the scene, it wasn't an attack. Really? Reporters never contact the other side in a conflict? What was this group of men doing then and why was this journalist taking their photos? Again, we'll probably never know. Either way, the reporters were certainly in the wrong place at the wrong time. As for the van / "rescue vehicle"... that was indeed tragic that the two young girls were inside. Ask yourself though, what do you think an Al Qaeda/insurgent rescue vehicle looks like? Do you think it would be marked as such? Do you think Al Qaeda/insurgents live with their families or live apart from them to keep them safe? Unfortunately, war is an ugly and horrible thing. Civilizations developed rules of war to try and limit the danger to noncombatants. One of the key rules of war was that combatants should wear uniforms to be able to be distinguished from noncombatants. If you fought and didn't wear a uniform, you could be shot as a spy if captured. If you fought and did wear the uniform, you'd be afforded certain rights which were eventually codified into the Geneva conventions. Terrorists and insurgents don't follow the rules of war. They use noncombatants in their society as shields and directly attack noncombatants in our society.
If the dialog of the pilots seems inappropriate or makes you blush as politically incorrect, I don't know what to tell you. The pilots and gunners are aggressive and they need to be. In 2007, convoys/patrols/and helicopters are being shot at and ambushed daily. Their job is literally life and death, both for themselves and the troops they're covering on the ground. Real life missions don't include a replay button. Regardless of what actually happened on this day... In their minds at that moment, they just killed the bad guys and saved themselves and the other good guys from harm. If you still find their dialog inappropriate in that context, do you think you could be more clinical and cold? Are you willing to do their jobs and do them better?
Finally, I have no insight to lend on why the two girls weren't taken to the US hospital. There could be many reasons, but it would all be conjecture. Hopefully they received the best care that was available at the time.