I wasn't talking about the players. I was talking about the characters. DF is a single-player game, and the characters can't stop you, so everything you do to them is fine.
The victims here would not be the characters but the players themselves. That is because there is no difference between killing the exact appearance of 100 people and actually killing 100 people
from the POV of the one doing the killing (not in objective reality). So regardless of whether the people being killed actually exist all, the person is now themselves psychologically affected by the act of having killed the appearance of 100 people exactly as they would as if they had really killed 100 people.
To clarify things, I am of course not arguing that playing DF is actually unethical, only that it is possible to play the game such that it is actually unethical. Even in the case that you did play the game unethically, the effect would be minor because the game lacks immersion owing to it's poor graphics, meaning that there is a long way to go between killing folks in DF to killing folks in real-life. This however is just a technological limitation really, some types of games have more unethical potential than others, the worse games are those that fit closest to reality as depicted in either the abstract or the mundane, that is they mirror the real-world either as we abstractly imagine it to be (think strategy games with maps) or as we actually see it (think Elder Scrolls type games like Morrowind, Oblivion or Skyrim).
For a thought experiment lets imagine something called the PIG, (stands for perfectly immersive game); it's rather like the Matrix really. If we do something in the PIG then it is essentially identical to actually doing it in real-life. In PIG I murder 100 small children, these beings do not of course actually exist in PIG but because PIG is so immersive the experience of killing them mirrors near-perfectly the experience of doing so in real-life. Even though you did not actually kill anybody who exactly existed, your experience of the world is now that of a person who murders small children; you are a murderer in effect even though you never actually killed anyone.