There is a time and place for everything. In some situations, you need to be heroic, and stand off against your enemy, face-to-face across a plain, with your army behind you. In other situations, you might need to sneak behind your enemy's back, and destroy him through his weakness(es). Isn't that what the principle of hostage-taking is based on? If you take someone whom your enemy/opponent loves, or cares for, then you can exploit their weakness.
Gandalf knew that facing Sauron's army in open war wouldn't accomplish anything in the way of destroying the One Ring. Rather, it would fall into Sauron's hands all the quicker. He realized that they would have to be sneaky if they wanted to destroy the One Ring, and he never lost sight of that goal. Sometimes, in war, you have to be like Sir Francis Walsingham (in the movie Elizabeth), rather than a Sir William Cecil (in the same movie). You have to be able to kill while smiling and carrying on a normal conversation, but you also have to live by some sort of honor/moral code. It's just that some situations require solutions that many people would find disturbing/cowardly/immoral. Would you have preferred Gandalf, Frodo, and Aragorn to march right up to Barad-dur, invite Sauron to tea, and kindly ask him if they could drop the One Ring into Mount Doom? I think not.
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But Melkor also was there, and he came to the house of Fëanor, and there he slew Finwë King of the Noldor before his doors, and spilled the first blood in the Blessed Realm; for Finwë alone had not fled from the horror of the Dark.
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