I found killing the Grand Cleric Elthina by bombing the chantry to be reprehensible, from the start. On more than one playthrough I gave in to Sebastian's whining and had Anders executed. But on analyzing it, this is not the right decision, for several reasons.
(1) First and foremost, Anders is right. His methods may not be the most effective, but he is right, on all points. The Templars created the blood magic/abomination problem in Kirkwall by Meredith's iron grip. The mages had no choice, no recourse. Forced into a corner, it was their only option. (Not that blood magic is inherently wrong or evil in the game, either. It just puts the mage using it in greater peril of losing themselves to possession.) There is no question that the problems in the Kirkwall Gallows are the Templars fault...and one person alone could have solved them - Grand Cleric Elthina. While her devotion, her compassion, and her moderation are commendable, she chose to ignore a problem where she had the authority to resolve it. Stronger leadership could have fixed this from the beginning. Killing her no doubt would turn the populace against mages, so Anders probably did his cause more harm than good, but in the end, he did strike right where the entire blame lies: With the Chantry.
(2) Sebastian Vael is a vengeful prick. He is all about revenge from the moment you first encounter him. He's a hypocritical bible-thumping ******* who obviously didn't understand the Grand Cleric he wants to avenge. "Death is never justice," she told him at the beginning of Act 2. Right or wrong, that was the view of Grand Cleric Elthina. He dishonors the life of the woman by demanding Anders' head for killing her. Would she have asked for Anders' head if the situation was reversed?
(3) Over two Dragon Age games, I've pardoned far worse than Anders. Zevran and Leliana were assassins. Sten murdered an entire family. Jowan was a blood mage assassin. One one playthrough of DAO I even let Loghain live. I helped Morrigan escape this world with her old-god-souled child. We saved the life of Flemmeth. Hawke spent a year committing attrocities for Meeran's Red Irons. Isabela's actions cost how many lives in Kirkwall? I never killed Bartrand. Merrill...well, I don't find anything she was trying to do wrong. (I was very disappointed when we couldn't fix the Eluvian.) Dragon Age seems to very much focus on Redemption. So here we have Anders/Justice, who committed a justifiable attrocity with dubious wisdom, in an entirely righteous cause, a man and spirit of virtue who has distinguished himself with both the Hero of Fereldan and the Champion of Kirkwall. Who am I to condemn his actions, let alone execute him?