As for the Falmer (They are Falmer, calling them Snow Elves is like calling the Dwemer, Dwarves.), they started the conflict and they were beaten. The Nords simply displaced them. It was the Dwemer who corrupted them.
It's not an horrific act to defeat an enemy, and those here that think it is, should probably consider that the next time they wipe out a bunch of Falmer themselves, they maybe corrupted but they still hold the same value and mentality. Which is exactly why they are where they are.
People use the terms Falmer and Snowelves to differentiate between what they were, and what they are now and there is a significant difference. It's used in the exact same way in the game. Many NPCs will say Snowelves whenever they are talking about the Falmer who lived during Ysgramor's time or King Harald's rule (time of the battle at the Moesring) but say Falmer when refering to modern day Falmer.
How we view the conflict between the ancient Nord and the Snowelves is pretty much up to the player's own interpretation of the available ingame literature and NPC talk I think.
I personally consider what followed the attack on Saarthal genocide, but again, it's just my personal interpretation based on what little information we've been given.
It is stated that the ancient Nord killed the Falmer by the thousands (Enthir says this during the Thiefs Guild quest). A diary can be found in a Dragon Priest tomb near Riften that describes how the ancient Nord chased the apparently retreating Snowelves practically all over the province until they (the Nord) took a break from pursuing the elves (they're encountering less and less of them) to find out more about the Priests and their treasures. You can not take time off from fighting a war unless your enemy is horribly outnumbered anyway - or you are still calling it war, because it somehow escaped your notice that you are fighting civillians armed with daggers by now. Not all Falmer can have been warriors after all. There must have been children, elderly and people with no fighting experience among them, but the ancient Nord intended to purge Skyrim of the elven pest for good and so they did. There's also a book in the Dwemer Museum that describes the ancient Nord as the only human settlers in Tamriel who did not manage to establish (at least for a prolonged period of time) a peaceful coexistance with the native elven population.
We don't know what the Snowelves or rather their mentality were like, when they were still the proud elven population of Skyrim that rivaled even the Altmer in sophistication (Enthir again), but we know what the ancient Nord were like, and, well, history is written by the victors and yet they do not appear in a very favourable light in the history books where this conflict is concerned. They value honour, but this purge doesn't sound very honourable to me.
I do not kill Falmer btw. unless I see them killing people as well. (Frostflow Lighthouse and Liar's Retreat come to mind) We've been denied the option to actually interact with them, eventhough they are shown to have all kinds of servants, which is unrealistic to the extreme. If they have servants, they must be able and willing, at least under certain circumstances, to comunicate with other races. I usually sneak past them, when I encounter them in Dwemer ruins, because I basically broke into their home. I even returned what we stole during the thiefs guild quest to Irkngthand after completing all the related quests.
As much as they disgust me (not their appearance, but their cruelty), stealing something of such sentimental value from people who have fallen so deeply already was wrong. I'd rather not stoop to their (current?) level.