You guys got this all wrong. Stark was mad that his weapons were being turned against civilians and US troops. He reacted by making a better weapon and killing the bad guys–handing one guy over to the civilians for them to torture/kill as they wished. These are not the actions of a peace nick. If you listen carefully to what he actually says, he never says he’s going to stop producing weapons, just that he’s suspending production until he can fix the problems of them killing the wrong people. Basically he was trying purge his company of the corruption that later becomes part of the plot.
The end fight had to put Iron Man in jeopardy (just as all superheros must almost die at some point) as well as bind Pepper to his cause. This was why she had to save his life. Blowing up the reactor was contrived and the weakest point of the movie, but I didn’t read anything more into it. I went in bracing for a liberal message and I was quite relieved to not find one. If anything this movie should be commended for holding the US military in high regard. The US soldiers come off looking both human and professional. There are plenty of movies where this isn’t the case. As conservatives we need to pick our battles better.
