If I understand the situation as it unfolded, the Iraqis were holed up in a mosque taking potshots at our marines, which is strictly a no-no. Temples are typically sanctuaries, not to be used as firing positions. A group of marines stormed the mosque, during which the Iraqi insurgents were wounded. After the insurgents surrendered, they were told to sit tight and another group of marines would arrive to pick them up and take them to the back of the lines for treatment. Once the original marines are out of sight, the insurgents dig up some more weapons, and fire upon the second group of marines. The second group of marines storm the place and find the wounded insurgents. One of whom is playing dead, presumably waiting for the marines to clear out so he can take up a firing position again. Unfortunately for him, "pop goes the weasel..." I believe that this would qualify him as a spy or saboteur, and thus would not be subject to protections under the Geneva Conventions. The shooting is justified.
The moral of the story is don't be a weasel.