Just awful... wow

Well:

1) Try looking into WW2, vastness and ingenuity of people of those times. Obscure, bizzare and often daredevil tactics were used on many occasions, often successfully by allies. Sending a marine squad to eliminate an enemy leader sounds like one of those things from WW2:
- making dummy tanks from balloons and plywood like allies did, to confuse the enemy
- crossing the same bridge twice - once in daytime, then returning those tanks in nightime, and then crossing that bridge AGAIN, so that spies and onlookers would think the army is twice the size (german army did this more than once)
- placing a dead body on the coast of Spain with "secret" documents, which said that "allies are gonna invade through Greece, not Italy. Spanish nazies redirected this information to germans, and germans put their bulk forces on Greece....Leaving Sicily and Italy quite open

Jake has made a great name for himself. Not just bows and arrows. Has the power to unify not only the NaVi population, he used the power of the whole planet. As an expeditionary force from a different planet, "skypeople" are forced to respect that. Their resources are limited. So they target the leader, in this case it's very wise to do so, and for more reasons why I described.

2) Marine was incompetent in "skypeople's" body. Now they give him a new body and the tactics and approach changes. And a new approach hasn't failed yet, if you haven't tried it yet.

3) Sully doesn't know how or when or where the colonization will start. Nothing is clear at that moment, Sully actually doesn't even know if it's a colonization, he has no info about Earth's fate or plans of the newly arrived "skypeople".
Sully sees a "hit squad" that is after him and his wife. He sees the monetary investment -- those are avatars...they cost. He realises the gravity of situation.
Sully also knows that it's both an advantage and a disadvantage, that they're only after him this time. Advantage, meaning, they wont kill his people in mass, they'll be only after him, so he can lure them away. Disadvantage - he'll be on the run, alone.

adding to:
3) I did, like you, feel like such decision is the weakness of the plot. But in all essence it shows how in tune Sully is with his selfless attitude, and how much he loves his family. On top of that, he cannot ask the whole clan to protect him and fight for his own fur, that would be even more out of place.
4) You forget, that they don't know if he's "with his people", if "he's taking a dump somewhere in the forest" or if "he's running around the planet gathering forces".
What they do know, is that he's the biggest threat and very dangerous, he's like a "link" that combines the whole resistance of Aiwa.
Also, the new Marine Avatar program was created for this purpose. So everything stands into place - Sully still alive, still dangerous, Marines have an objective, and they go for it.
Fog of war is the answer.
5) A spontaneous event changed things. That is visible in the movie.
And a reinforcing argument, again - they're outnumbered not only by indigenous people, they're outnumbered by the whole planet. In such situations you hold on to hostages for as long as you can, and you squeeze the enemy as much as you can through those hostages. If a massive whale is about to land on your head, I doubt you'll be standing there squeezing the trigger at some poor kid, you'll be moving away so the whale doesn't turn you into a new paintjob for the ship's deck.
6) He's alone against many. Left totally alone. Doesn't know where Sully's wife is. Sully is a huuuge threat. Might need to use Sully against her, to draw her out later. Who knows. Standard villain behavior -- full of themselves, they start reading death poetry instead of pulling the trigger. Looks very unrealistic, but you'd be surprised how often people do that IRL, not exactly like this, but in spirit - alike.

There were other things that were slightly more annoying than the way they twisted the plot, but once the movie finishes, it's clear - there's gonna be anotha one. And probably quite soon-ish.

Not totally awful, but it took me forever to figure out which kid was which, and the only one of them who had any kind of real personality was the Sigourney-ish girl.

So as far as the script went, I think that the focus on the whole large family, instead of one or two protagonists, was a weakness - a BIG weakness. And one who will carry through the sequels, because Cameron wouldn't focus on the family like this if he wasn't planning to make the kids stars of future movies and phase out the adult actors.