Sorry if anybodys mentioned this as I don't have the patients to read through this whole thread...
This situation to me seems to be a double edged sword, on the one side the fact is that you have successfully bred baby fish and by keeping them alive you give them the chance to thrive, grow and live their lives to the best that you can offer.
On the other side, if you have a larger predatory fish then you are just completing the natural cicrle of life that would occur in the wild. (big fish eats little fish).
Yes, there is the question of morality in this situation, however if the fry are going to slowly end up dying in your tank that is too small to sustain the amount of fish that say guppies can produce, then it is no longer a question of what's right or wrong, it's a question of ethics. Are you going to let the little fish grow up in a bad enviroment? Or are you going to allow them to be eaten quickly with minimal pain?(I refer to them being eaten as minimal pain as the fact of the matter remains that living in an ammonia, nitrite and nitrate filled enviroment would cause a lot more pain over a period of time.)
Myself, I do not find it to be unethical, however I do quest the morality of some whom do this. I'm still on the fence myself, however if I have a large fish that eats small fish to survive in the wild, and as a responsible fish owner I am trying to duplicate it's natural enviroment (weither it be Ph levels, area of the world, landscape set-up or food -in this case) then yes, I will feed live fish.
This brings us back to the question about feeding live goldfish, is it right or is it wrong? There is no right or wrong answer to this question, just opinions.
And for those who say "feeding other fish, live fish is wrong period." well I have this question to ask, is feeding a lizard crickets or other insects wrong? It's their natural food source in the wild (not so much crickets, but other insects) and as a responsible pet owner your responsible for providing an enviroment as close to their natural enviroment as possible. Yes, there are dry foods on the market, but even then they are not a complete balanced diet.
So to answer your question emma, I find nothing wrong with feeding live fish, however if the chance arises to give them a proper home, even if your only given a penny per every 2 fish then who cares? A home is a home and if the lfs sells them to make more money oh well, it's just another circle of life.