The most jaw-dropping line in the Torah

Those who study the Torah portion day-by-day came across the most stunning line (Num. 31:17-18) yesterday, which a furious Moses addresses to the Israelite officers (chiliarchs and centurions, if you want to get technical) upon their returning from the Midianite War with captives:


And now kill every male among the little ones, and kill every woman that has known man by lying of a male; but all the women children, that have not known lying of a male, keep alive for yourselves.

As I see it, there are three issues here:

1) Genocide!
 It's easy enough to quibble over the specifics of terms which might have been offered to Amalekites and Canaanites. One can also understand the fog of war, in which distinguishing between combatants and civilians may be extremely difficult and dangerous. However, this execution of the Midianite boys is not happening on the battlefield, or even at the battlefield. It happens right outside the Israelite camp. The man who was saved from a decree of "Cast into the Nile every boy born, but keep alive every girl" is now applying the very same (except now including the mothers and big sisters). Now, the Torah does not state that this was carried out, even though it very meticulously catalogs the execution of the rest of the orders. I'm not sure if that is a mitigating factor, considering the next element.

2) Slavery!
Yes, we know that ancient peoples kept slaves, and this was true for Jews as well, at least into early Talmudic times. Still, there is a world of difference between the laws of keeping slaves in Exodus and Leviticus and the cruel calculus here. 32,000 virgin girls--so that's 16,000 each to the soldiers and the citizens, with the latter paying a 2% tax to the Levites and the former paying a 0.2% tax to God.

And the persons were sixteen thousand; of which the LORD's tribute was thirty and two persons. And Moses gave the tribute, which was the LORD's heave offering, to Eleazar the priest, as the LORD commanded Moses.     

Heave indeed. Eleazar, colleague and nephew of Moses, gets 32 virgin slavegirls, Midianitesses like his Aunt Zipporah. The Levites had to split 320 among their half-dozen families, and one wonders how many the Amramites, i.e. Moses' sons, got to take home to Mom. ("What, you're from Rekem? I'm from Rekem too!")

But perhaps the most confounding is the textual-sexual issue:
3) Orgy?
You see, what we have translated "lying of a male" is actually mishkav zakhar in the original, which is ironically used in Mishnaic Hebrew to refer to sex between males. What exactly is it supposed to mean here? When the Torah discusses sex between males (Lev. 18:22, 20:13), the term used is "mishkevei isha," lit. "lyings of a woman." Is it significant that mishkav zakhar is singular and uses a term of gender, while mishkevei isha is plural and uses a term of personhood? Are we to take the former to refer to all heterosexual intercourse and the latter to refer to all homosexual intercourse? Or perhaps mishkav zakhar refers to vaginal intercourse ("lying of a male" thus referring to the kind of sex only women can have) and mishkevei isha to anal intercourse ("lyings of a woman" thus referring to the only type of sex you don't need women for)?  Does any of this change how we read the prohibition in Leviticus?

I'm starting to wonder if Tosafot (Megilla 31b) are wrong: maybe we combine Mattot and Masei not to get the bad stuff out of the way before year's end, but so that we can bury the lead.