Psa 137:8 O daughter of Babylon, who art to be destroyed; happy shall he be, that rewardeth thee as thou hast served us.
Psa 137:9 Happy shall he be, that taketh and dasheth thy little ones against the stones.
Recently I came across an interpretation which I believe to be erroneous.
It expounded upon the fact that the psalmist was deeply troubled and therefore showing an honest declaration of sinful hatred. That the distasteful passage was not of God's oracle but of a human response.
I believe if a word is presented in the scripture without any indication of ulterior meaning before or after, we cannot simply arrive at our own conclusion based on our own emotional/moral standard. If so, we would be in danger of calling God a liar.
Only in this faith, that we can see the remarkable purity of the psalmist instead of the opposite, as well as a deeper sense of God's judgment and holiness. That we have not a single excuse in our own right to demand God's mercy.
God is not nice, but gracious. And again, God is not nice.