You're forgetting that this corporation doesn't operate in a vacuum.

1. That Pandorans are intelligent has already gotten back to Earth, and there's a sympathy movement amongst company stockholders. Publically traded companies don't get to commit genocide all willy-nilly!

2. What coporation in the world is able to produce chemical weapons without being sanctioned by a government (which these guys were not)? Much less transport them!

3. All of the recruits were ex-military, with the body of them apparently being Marines.

4. Where are they supposed to get chemical refineries to make more explosives?

5. Did you not notice that they already bombed the shit out of the Na'vi? Did you miss the part where that tree the size of the Empire State Building caught fire and collapsed?

6. They do not have the necessary materials to carry out the operaiton yu're talking about!

7. They do not have the financial backing of stockholders to commit genocide!

8. They do not having the financial backing necessary to bring an armored division with them! There was one ship in the whole movie capable of achieving escape velocity!

9. There have been two flights to Pandora - two - because round trip as I recall takes more than a decade and they've only got the one ship capable of interstellar travel.

10. I looked it up in the scriptment - transporting anything to Pandora costs ONE MILLION DOLLARS A POUND

That's why you simply say they attacked us.  The company obviously decided to wipe the Navi from that region so they had sanction to do something about it.  If they could say that their only option is chemical warfare then what are they going to do?  As you have pointed out, any other option is just too expensive to justify the cost so that is their only alternative. 

I'm sure Sigourney Weavers character would bitch and moan but I have the funny feeling they want to kill her anyways.  Again, all they have to do is lie because who is going to be there to investigate?  I'm sure there would be an investigation eventually but what would really be found after they had years to cover everything up?

I'm positive there would be an uproar but considering their actions in the movie I don't think they care.  They will probably plant a tree back come and call it a wash.

The thing is that chemical weapons have to be produced on Earth, where they won't be able to get legal rights to do that regardless of whether or not they were attacked by natives that they were attempting to colonize.

Secondly, the "attack" only happened after the second trip - it would only be the next trip that would allow them to bring more force to bear. And you know what? It's no longer financially viable! That was one of the points of the original scriptment: they had incurred losses so enormous that going back and restarting the whole operation from scratch was seen as too expensive to try!

What's more, you're calling the corporation stupid. THey weren't stupid. They had excessive force that absolutely wiped the Na'vi out. If it hadn't been for certain unpredictable factors (like a foreigner bringing together disparate tribes and then the planet itself attacking) then they would have won! Their loss is not strictly the company's fault.

Even sniper rifles and turrets would do better than what they had.  I mean really, how cost effective is it to build a giant mech with a giant knife? 

See, I would have brought the weapons with on first trip.  There's no way I would wait for the inevitable attack, I would kill them and then just say they attacked.  Stupid could be the wrong word, but not prepared or not smart could work.

It would be smart going into an unfamiliar world thinking of every opportunity.  I have no idea what could unite all the tribes but I know it could happen.  I have no idea the planet would attack me, but I assume dangerous wildlife is dangerous.  If I bring enough chemicals to destroy everything around me, I'm good.  I would play nice for a few years, attack, and then be done with it.  There would be none of that waiting, I would do what an evil corporation is supposed to do: lie and fight dirty.

If I know bringing heavy military weapons is very cost prohibitive, then I have to assume that biological weapons are the logical alternative.  I assume my government that sanctioned bringing an army to the planet would know this and knowing how valuable unobtanium is, they very well could approve it and or at least look the other direction (assuming I even told them).

I'm not a business man, but I keep hearing that a good one prepares for everything kind of like a boy scout.  The corporation in Avatar didn't and that's why they were defeated.  A smart (not stupid) corporation would not have played games.

You are thinking like a supervillain, not a businessman.

Do you know why they were trying to educate the Na'vi? (here is a hint: there are parallels in almost all colonial societies)

Meh, supervillain, head of a giant corporation, not a lot of difference (especially when the movie is trying to paint the giant corporation as the villain).

I personally wouldn't try to exterminate the Navi but if I were head of a giant corporation where I was the only one in the universe that controlled the flow of a single important element, I would do everything in my power to make sure I stayed in that position.  If the Navi were or even could threaten that, I would stop it before it became a problem.  I really don't know how worried I would be about the repurcussions because, again, I'm the only person that controls that element. 

There is a lot of difference, because this was a corporation and not the Legion of Doom.

Try to answer the question. Do you know why they were trying to educate the Na'vi?

I don't really remember, though I'm guessing Sigourney Weaver's group had more to do with that than the corporation.

Nope! It was actually corporate's idea.

See, the thing is that they figured if you offer the Na'vi medicine and an education, they might be willing to work for you - the idea was that the Na'vi were already adapted to the environmen, much stronger than humans, and wouldn't take hundreds of millions of dollars apiece to transport to Pandora.

They brought the science team to educate the Na'vi so that the Na'vi would be able to mine the unobtainium for them.

It's a lot more cost effective that way.