Aren't they sentient? They are able to perceive and feel things.

This was my immediate reaction. Pain experiments, as described in the article, are a necessary "evil" in many animal experiments. Human trials have the same conditions, with both the pain of treatment and the suffering of being in the "control" group and having false hopes; however, participants have consented to the experiment.

We empathize much more strongly with animals that behave in human ways. Couple this with the "cuteness factor," which I use to mean that we are sensitive and protective of things that we find to be cute (babies, kittens, Yoda, puppies, etc.) and we have a very irrational, visceral response to the idea of torturing cute, smart, affectionate, best-dog-I-ever-had, animals.

It's not inherently bad but it clouds our judgment on what is right and wrong in terms of our treatment of these animals and the ends that justify this treatment. We (as a species) kill and eat whales, which most of the developed world has agreed to be unacceptable.

I don't know if this is moving in a "Rats of NIMH" or "Planet of the Apes" direction, but the philosophical ramifications of sentience are likely to be explored as a result of this type of "improvement".

We have a huge body of sci-fi, speculation, religion, and thought-experiments regarding sentient non-human forms, including what defines "life" and "personhood". It will be an interesting test of humanity to see how we deal with any positive results of this type of exploration.

On the topic of AIs, not mice, but very relevant to the questions you mentioned: http://lesswrong.com/lw/x7/cant_unbirth_a_child/