I think most kids are smart enough to understand the difference between insects and the higher forms of life that are capable of experiencing suffering.
Recently my daughter befriended a tiny ant while at the blacktop at the local rec center. She was sort of taking a time out from interacting with her human friends for a bit.
Then one of her friends came over and squished the ant, thinking it was funny, saying "it's just an ant" when my daughter complained.
It really bothered me. Not the death of the ant, obviously. (so what, I step on them all the time)
I don't know if you have kids, but I think there was something a bit off about that girl and her choice to kill the ant. Maybe you would consider her "smart." I didn't.
I observe a correlation between overattachment to animals and lack of empathy toward other humans.
In other words, people with "fur babies" are far less likely to have well-formed consciences.
“He who is cruel to animals becomes hard also in his dealings with men. We can judge the heart of a man by his treatment of animals.”
― Emmanuel Kant
https://www.goodreads.com/quotes/13607-he-who-is-cruel-to-an...
I'm sure there are people with unhealthy attachments to animals, and who knows the extent of their issues and how they manifest. But a child who rejects a hobby that, at its core, is the deliberate killing of animals that they find beautiful, isn't that. As a parent, I say it is exactly how a child should be at that age.