re: These are human beings.
You wrote: "We owe it to our own principles to treat them as such, regardless of how they decide to behave."
We owe it to them to treat them exactly how they treat their prisoners. It is the obverse of the Golden Rule: "Expect to be treated by others as you treat them."
If we give them POW status, then how are we encouraging them to do likewise?
How do we encourge them to cease murdering civilians?
Only by treating them the way that they treat others can we hope to modify their behavior. It is called "negative feedback" in Psychology.