I think that's pretty sensible.I break the fourth wall now and then to keep the game fairly lighthearted and remind everyone that it's just a game, and no, there aren't gonna ever be orc babies to worry about, so don't overthink it.
This, though, I think is more taste-dependent. I don't think there were ever goblin babies in my 4e games (there were no orc babies, but no orc adults ever appeared either). There were human babies, and I remember the table - including me - being a bit shocked when the wizard PC ruthlessly killed the hobgoblins who had kidnapped said babies and then surrendered to him. Generally in our 4e game when goblins and hobgoblins surrendered the PCs accepted their surrender and converted them or otherwise released them on parole.It's mostly an abstract thought-exercise, because regardless of the metaphysics of your setting, making your players have to decide what to do with the orc babies is probably going to make you a really unpopular DM.
I have run games with humanoid babies - including a Rolemaster game set in Greyhawk - but part-and-parcel of that was that orcs weren't just to be killed on site.
I don't think there's so much a right way, but rather that the GM should honour player expectations, especially when the GM has helped to shape those expectations.