1. Ancient conquest accounts use the language of slaughtering women and children as hyperbole (see K. Lawson Younger, Ancient Conquest Accounts: A Study in Ancient Near Eastern and Biblical History Writing [Sheffield: Sheffield Academic Press, 1990]). It's somewhat equivalent to someone playing a game of basketball and saying to his opponent, "We're going to annihilate you." The language isn't literal.
2. What proves the above is the fact that there are tons of Canaanites left over from the conquest after Joshua and that generation dies. The Israelites have continual problems with them, and as I argued before and will say again below, if one does not wipe out the entire tribe of his enemy, the children of that tribe will rise up and wipe out your children according to the ancient commitment to fulfilling familial vendettas.
3. The purpose of God is to wipe out the Canaanites eventually in His judgment of their sins, as according to Scripture, when one practices chaos, chaos is then turned in on him. If he wishes to participate in practices that kill children, his children will be killed and his line snuffed out from the earth. Hence, even if it is not fulfilled in the conquest accounts, God made it clear via revelation that it was His goal to bring judgment upon the various tribes lumped together as "Canaanites." If God does not have the right to end the lives of men, women, and children according to His terms, then one needs to make an argument that He doesn't have the right to do it now, as according to the Bible, He ends the life of every man, woman, and child who dies on the planet by deciding that their time has come to an end here.
Furthermore, if He does not work toward the goal of wiping out the Canaanites, then His establishment of the Israelites is all for nothing, as the people He saves today will simply be annihilated tomorrow (according to ancient Near Eastern tribal thinking concerning vendettas), defeating His whole purpose to save Israel.
4. His purpose is to give birth to the nation of Israel, and in so doing, teach them to defend themselves in war. If we are to understand what is going on, we have to cooperate with the biblical narrative. They have lived their whole lives as slaves in Egypt. They have never fought or defended themselves from any harm. It seems necessary, therefore, to include them in their own reacquiring of the land and the defense of their own people.
5. The account says that God kills more Canaanites than the Israelites do. Even though he involves them, the judgment of the Canaanites is primarily His work. We only know this because God spoke to Moses and Joshua and told them audibly that this was the case. One cannot make an argument that he or she is fulfilling God's judgment upon a people unless God has specifically given that person such a revelation, and many orthodox Christians don't believe revelation of such a thing is still given, nor do they (and this is the really important point) believe that the Church, which is the only institution that would receive revelation from God if He still communicated that way, has authority to enact God's physical judgment upon a person or group. The sword is given to nations, not to the Church. The Bible separates the sphere of authority between church and state, one governing the spiritual war and the other governing what may occur physically. Hence, there are numerous applications to be made of the Conquest Accounts into the believer's life today, but participating in physical judgment of a person or group as God's emissary is not one of them.
I'll say again what I said before. You cannot judge an ancient people in a completely different context than your own. In tribal life, a tribe is in continual struggle with any other tribe(s) it may rub the wrong way. The context is unique by that alone, but what makes it even more unique is God's divine commands concerning it. Making judgments from the Lazyboy only furthers the apathy toward such a way of thinking, as one's life, family, community is in no danger from another community that wishes to take his life, the lives of his family members, and annihilate his community. But in this ancient setting, that's exactly what the Israelites had to worry about, daily. "And God saw their affliction and had pity on them."