(this is a great thread)
In my opinion, I think it's a reasonable assumption that even in the presence of a Federation charter, Starfleet rules, and a legitimate government (Federation Council/President), there, inevitably, will be situations where the rules and the law are inadequate, or in some cases, a barrier to the safety of the Federation. As a consequence, basic human nature will drive some so-called patriots to do what they feel needs to be done to safeguard the Federation, rules be damned.
I firmly believe organizations like Section 31 form naturally in any society (maybe not in name, but they'll form nonetheless) because there will always be people, guided by their own morals and beliefs, who will do what they feel is necessary to safeguard their society and pool their resources with others who share the same sensibilities. Whether we believe they should exist or not, I think it's impossible for them to not exist, unless we discount human nature. I know it's probably not the point of the thread, though
As far as the attempted genocide of the Changelings; while it was wrong and reprehensible to both our values and the values of the Federation -- I think that by the time the Federation learned where the Changeling virus came from, the Federation had no choice but to deny the cure to the Founders. It may seem very convenient, and even contrary to the values of the Federation, but in light of the fact that curing the Founders could potentially cost them the war combined with the Federation's "clear conscience" of not having directly caused the virus, they had to withhold the cure at that point to safeguard the Federation. As far as the Federation was concerned -- "we didn't do it."
I know it's wrong -- I know it's convenient, and Odo was completely right to tell Bashir to STFU when Bashir tried to tell Odo "well, it was a rogue organization, blah blah" -- but at that point, and I'm sure Section 31 counted on this -- the Federation had no choice. They were barely winning the war with the Founders dying. They had to take every advantage they could get, and the "tidy little arrangement" was a simple, unavoidable fact.
Even more importantly, by offering the Founders the cure outright, the Founders would have found out who was responsible -- and from what we know of the Founders, I believe they would have, rightly I might add, been as indignant as Odo when he found out. They would have taken the cure, cured themselves, and then found a way to decimate the Federation because they would not have made a distinction between Starfleet and a "rogue organization." -- and the Founders would indeed have had the moral high ground here.
Once S31 released the virus, the destiny of the war was set. The Founders would either die, or the Federation would offer them the cure, and the Founders would not look at it as kindness or any type of olive branch -- they would re-triple their efforts to destroy the Federation Alliance and annihilate every Federation world in kind. It will have validated their mistrust of solids. The Dominion would not have ruled the Alpha Quadrant -- they would kill every living thing in it -- nonaggression treaty or not. Fortunately for the Federation, Odo had influence with the female changeling.
Anyway -- I believe in what Section 31 is trying to do -- the Founders disease, however, was the very definition of irresponsible behavior. They gambled the very existence of the Federation and its allies and the lives of every Federation, Klingon, and Romulan citizen on the Founders not finding out where the disease came from. Thank the Prophets for Odo.
At least -- that's how I see it.