The idea is, of course, that most of the lives we take are really evil anyway, so we're actually doing the real good guys a favor. We kill tons of demons, ghosts, zombies, dragonkin, giants, and rabid beasts -- even most of the humanoids we kill are bandits or wicked cultists of one sort or another. This way we do lots of killing, but still feel as though we are heroes.
There are some situations in the game, however, that turn things around for us, in which our character is not the hero. While there are some higher-level instances such as the Black Morass, or the new Caverns of Time: Stratholme, in which one could argue either way whether what we're doing is good or evil, most of situations in which you are clearly the bad guy, as far as I am aware, have to do with the undead, and to a lesser extent the blood elves as well. Of course, you can argue that in general, undead are just misunderstood, and the blood elves are just tragically misled, but as in the case of quests in Hillsbrad that ask you to go slaughter human farmers, or help develop a new plague, there's really no denying that your character is doing something "morally wrong."
"But it's just a game!" you say, "Dude, chill out!" And yes, of course it's just a game. I did those quests just like everyone else, and I'm not saying they should be taken out. Doing morally wrong things in a game is very different from doing them in real life.
However, there's one moral limitation built right into the game mechanics, and it's worth being aware of. Aside from critters such as squirrels, rats and cows (and it's debatable as to whether those count or not) each and every killable entity in the game is capable of defending itself in one way or another, and usually they will attack you if you don't attack them first. Furthermore, it's actually impossible, as far as I know, to kill children in World of Warcraft; this isn't realistic, of course, but it does a whole lot to keep the game from being depressing.
I know there are some games out there, such as Grand Theft Auto and Bioshock, in which you have to face the question at some point: Should I kill innocents who cannot fight back? Some games, such as Knights of the Old Republic, are all about such choices, and your character takes a very different path depending on whether they act out of compassion or selfishness.
But in WoW, we are denied that choice to a large extent. Whether we want our characters to be evil or good, all the same quests are available to them all the time, and there's no difference for your character between doing good quests versus evil ones. There are players out there who would love to run around murdering these digital kids if they could, screaming "It's just a game, STFU!" I don't understand the desire to do that myself -- perhaps it's a way of venting their own vulnerability they feel about themselves, to kill imaginary children who are the very epitome of helplessness? In any case, to my mind the invincibility of kids in this game and the power of almost all other creatures to defend themselves (even to the point where they'll come back to fight you after running away at low health) is what makes WoW so accessible to anyone who wants to enjoy a fantasy adventure for a while. You can just do whatever without making moral choices. You don't have to think about right or wrong at all unless you're dealing with other players, and anyway, the worst you can really do to players is camp their corpse or ninja their loot.
So here's a question for you to ponder. With all the slaying of terrible monsters in this game, the acquisition of heroic items, or even these quests to do something bad, is there anything actually heroic about what our characters do? Alternately, is there anything actually evil or heroic that we could do to other players? When we log out at the end of our game, is it all just happy harmless fun time with no moral consequence whatsoever?