Late to this party, hope OP gets a chance to read/respond. This is from an officer's perspective:
First of all, I'm going to address your question directly, then debunk your other arguments.
The difference between killing ISIS family members being unacceptable and collateral damage acceptable is both from a legal perspective and moral perspective one of intent.
Just as running over a person in a car accidentally is an accident, while doing it out of disregard/neglect can be manslaughter and then intentionally doing so is murder, the laws of war are very very clear that intent matters.
In this case, deliberately killing ISIS' family members - especially those who aren't at all involved in ISIS - is the deliberate attack on civilians and is very much against the laws of war.
You should note too that the Geneva convention doesn't give you blanket protection for civilians. In fact, it is designed very specifically to have multiple gray areas and outs. For one, it wants to dissuade combatants from using civilian areas/buildings to have an advantage. If you give hospitals and schools unlimited immunity, there's no reason why a defender wouldn't use hospitals and schools to store weapons or fight from as that immunity gives them a huge advantage in war. That's why the burden of the crime is on the person that uses hospitals and schools and other such buildings - and not the attacker - if such buildings are bombed.
In addition, don't conflate civilian with innocent non-combatant or non-belligerent. Take these three scenarios for example:
In every case, you can report that 3 civilians were killed. And that'd be correct. On the other hand, which of these targets is more legitimate than others?
Civilian A is an accountant in a very much non-combatant role. But he was working for the military and on base when killed. Would you say he was legitimate or illegitimate?
Civilian B is very much working on military weapons. She is killed in a civilian building where the prototype is being worked on. Is she legitimate or illegitimately targeted?
Civilian C is even more so directly working on arms. But, he is killed at his dormitory, as are many of his workers. In fact, Civilian C is considered the less legitimate of the three targets - because the air raid was conducted on work quarters deliberately designed to kill civilians. Had he been killed at the factory if the factory was hit, it would be a very different story.
Long story short - A and B can be considered 'collateral damage' and to an extent C can be too, but since C was directly targeted at civilians (albeit civilians directly involved in the war effort) while A and B were targeted at the base/prototype, C is the least legitimate/justified of these attacks and most easily considered a war crime.
Now, to counter some of your points being raised. You wrote:
but why would the "Shock and Awe" invasion of Iraq in which we bombarded Baghdad with cruise missiles and killed 6,000+ civilians be moral?
Shock and Awe wasn't directed at civilians. Again, see my hypothetical scenario above - do you consider civilians working at military bases or in Saddam's palaces legitimate or illegitimate targets? Shock and Awe was designed to force the Iraqi Army to surrender quickly - much as it did in the Persian Gulf War of 1991.
The Iraq was as a whole killed and injured hundreds of thousands of civilians.
The VAST majority of Iraqi deaths in Iraq were not caused by Americans. They were caused by the sectarian conflict between Sunni and Shia groups, and were mostly caused by IEDs and suicide bombings.
The Iraq Body Count has a database you can sort through all these deaths - the vast majority of deaths, particularly civilian deaths, were attributed to unknown/unaffiliated actors, not air strikes.
The American military has also historically used devastating bombing campaigns that kill hundreds of thousands of civilians as a military tactic (Operation Rolling Thunder in Vietnam, air campaigns in Japan, etc).
No, they haven't. This is revisionist history at its best, or a complete lack of understanding of those campaigns propagated by common belief.
Both Rolling Thunder and most of the air campaigns in WW2 were targeted at strategic targets first and foremost. In fact, Rolling Thunder had such strict guidelines on what could and could not be attacked that the North Vietnamese figured out the exact time and direction US planes would come in from, and caused immense casualties due to our predictable strategy and targets, but I digress.
You can certainly argue that some of the air campaigns in WW2 were directly targeted at civilians, but even then, you have to take into consideration some context:
That point is particularly salient when you understand that in WW2, targets like oil refineries and factories - often situated in civilian areas - meant that civilians were sadly hit frequently in order to hit the actual targets.
But even in WW2, thinkers of the day tried to avoid bombing civilians. The atomic bombs dropped in Japan, for instance, were preceded by leaflets warning the populace to escape:
The Japanese text on the reverse side of the leaflet carried the following warning: “Read this carefully as it may save your life or the life of a relative or friend. In the next few days, some or all of the cities named on the reverse side will be destroyed by American bombs. These cities contain military installations and workshops or factories which produce military goods. We are determined to destroy all of the tools of the military clique which they are using to prolong this useless war. But, unfortunately, bombs have no eyes. So, in accordance with America's humanitarian policies, the American Air Force, which does not wish to injure innocent people, now gives you warning to evacuate the cities named and save your lives. America is not fighting the Japanese people but is fighting the military clique which has enslaved the Japanese people. The peace which America will bring will free the people from the oppression of the military clique and mean the emergence of a new and better Japan. You can restore peace by demanding new and good leaders who will end the war. We cannot promise that only these cities will be among those attacked but some or all of them will be, so heed this warning and evacuate these cities immediately.”
Emphasis mine. Chilling to read.