^ But technically thats what the Federation was doing. He'd been captured by the Jem'Hadar before- he knew what they were like, he knew the fear he felt. So the desperation of the young soldiers stuck fighting the Jem'Hadar for months shouldn't have been lost on him, nor should he really be so high and mighty. What Quark was talking about affected people in our past- so we shouldn't be blamed, not should the humans of the Federation born hundreds of years later. Except maybe section 31...
I'm positive Quark was talking about the present. The Federation of that era. Where Earth is a paradise. He saw Nog looking up at humans and wanted to show him something other than that facade of I suppose moral superiority.
If it had been Klingons he was surrounded with he probably wouldn't have said a thing.