Exports from the South were not going to be the subject of retaliation since England needed the cotton and the mills were not going to allow Parliament to cut their throats.
You're missing a key point. In international trade it matters not so much what is retaliated against, but rather that retaliation occurs. Traded goods are essentially the currency for other traded goods. If you tax one of them, it will disrupt all the rest in some form or another. You can't "tweak" the tariff schedule to simply isolate out one single item because by taxing that item you shift imports away. Eventually the price of the tariff passed through to the exports that were originally the currency for those deflected imports.
You also seem to be missing the point of luxury tariffs, which were indeed paid on a revenue basis but are an entirely different system of rates than the protective elements of the schedule. Luxury tariffs are imposed on goods that are presumed to have inelastic demand curves, or in other words "dependency goods" like cigarettes and alcohol. They essentially function as a sales tax on those goods because it is assumed their buyers will purchase them even with the tax. Since they do not generally deter trade in that good, they do not exhibit the same distorting effects that a protective tariff usually does.
As to Hamilton's economics, go read Milton Friedman's critique of the Report on Manufactures. It is devastating. Even if one accepts the assertion that England's colonialism distorted US manufacturing, the policy prescription Hamilton offered is economically unsound because it incentivizes lazy monopolies and disincentivizes the very same competitively-induced innovative processes that are necessary for an industry to develop. Why do you think America lagged technologically behind Britain in iron smelting well into the 1830's despite being nearly on par in technology (just not equipment) at the time of the revolution? Tariffs took away some of the incentive to develop better smelting processes. Hamilton in this regard is very similar to the Keynesians who claim that stimulus spending will rectify economic recessions - they identify part of the problem, and their prescription often sounds intuitive the way that they present it, but the solution they offer is completely wrongheaded in a way that distorts resources away from the very same economic recovery they purport to be helping
Every economic action has a multitude of unintended impacts outside the area targeted. I would never deny that.
Hamilton’s economics were the result of practical adaption as much as theory. It wasn’t well developed but there was no one capable of convincing when arrayed against him. Certainly not Jefferson. He did not favor “monopolies” and there were none in the country at the time. It is quite a stretch to claim the tariff led to any claimed technological backwardness. Friedman’s ideology would led to some of his critique of Hamilton and does not convince me of anything other than the danger of monday morning qbing.
And there is no question that Britain’s colonial policies distorted our economic development. It was intended to do just that.