The empire placed those people in harms way. The rebels are acting in self defense. They have every right to destroy or disable the Death Star.
Anyone on the Death Star (the aggressor) is either there by their free will or they have allowed themselves to be coerced into that position. Either way, once the station is destroyed, they have no claim against Luke. They only have claim against the Empire for taking them hostage or for tricking them by fraud to be in that position.
This human shield scenario has also been discussed here.