I agree with you entirely Heliport. Sending the Pilot to prison neither remedies the outcome, nor resolves the issues that created the circumstance that led to this disaster.
Early on in this discussion, a number of posters stated that there was nothing in the relevant local laws that restricted this type of operation, nor was anything wrong with performing external load missions of this type over areas being used actively by the general public. Do they still hold that view?
There are many reasons why the load could detach itself from the aircraft, none of them requiring the pilot to push the button. Ask anyone in the external load business this, and they will give you all kinds of stories about loads simply detaching themselves for a variety of reasons. This is precisely why flying external loads over active roads, habited buildings and anywhere else the public, or your employee, might be should be a completely unacceptable practice.
The real cause of this was the local helicopter industry that found this to be an entirely acceptable practice, caused by competitive commercial pressures, according to some of them, and an operator that would allow his employees to work in this way.
I hope that the entire regional helicopter industry pays attention to this, and learns a lesson from it, if indeed they do (did) promote this type of activity and the regulatory authorities maybe review the operating limitations required for this type of operation. You may still not eliminate every accident, but you have at least removed one part of a very easily identifiable and remedied risk that exists with external load operations.