@FireFox well thing is, we don't really know if Oni are actually that dangerous in modern times. Ch.1 They said that Oni went into hiding and lived among humans, so they might be fully content with their way of life now and don't pose as much of a threat as they did before. Though, they objectively DO go berserk, as we've seen happen to MC, but is that purely because he's an oni or is it because he was made aware of being an oni? We don't know.
But yes, the momotarou group look much less virtuous if they discriminate on the value of life depending on the race of that life. It's not a good look. It's essentially racism, albeit somewhat reasonable, but even with a sense of rivalry/antagonism, there's a level of respect required for your opponent to not fall into the realm of hypocrisy.