No, you're not wrong. Killing a fleeing enemy, wounded or not, is fair game. Writing oneself up for a Silver Star for doing same is a bit much though.
The details about how Kerry secured his medals per fraudulent writeups or pulling of strings or whatever deserves a quite proactive investigation. Admiral Leyman's (sp)name I think came up somewhere. Maybe someone can ask him about it while he is on his dog and pony show tour.