The whole thing screams genetic tampering at increasingly alarming levels. I bet in the end they'll come out with something like the giant smurfs were once like us, but they contemplated the evilness of technology and progress and corporations, so they used all those evils things to fix their mistakes and to revert back to a stone age state, after applying massive genetic engineering on planetary scale to make their primitive paradise, uploading their minds to a matrix kind of computer after their bodies die. Or maybe somebody else did that for them and we came along tampering with their experiment.
One way or another that(extreme gene tampering) would explain in lore why they are so distinct to any other animal in their environment and the really bizarre "natural" internet thing (I refuse to dignify it calling it a name). The only use I find for it is to upload the consciousnesses of dying people, and then downloading it at will on another compatible body, that would allow us to achieve a immortality of sorts.
For the rest, I say simply bomb the whole thing from orbit and resume even heavier mining operations with heavier military backup.
As for the villain being charismatic, well, he was, but I found him a rather poor idiot at strategic planning.