Malbim: They should have killed them. Since they did not accept taxes and servitude, "Lo Sechayeh Kol Neshamah" (Devarim 20:12) applies to them. The Nesi'im's Shevu'ah did not apply to Klal Yisrael, especially since it was mistaken, and it was to nullify a Torah Mitzvah. Even so, the Nesi'im did not let them kill them, due to Chilul Hashem.