Let me get started on this point, about future circumcisions. Obviously if there is familial hemophilia or any other medical indication against future babies having circumcision, don't do it. If, however, the doctors say "this baby is totally fine" and the parents can't bring themselves to do it ... the parents are viewed as tragically mistaken, but not heretics.
Zevachim 22b reads:
Had the Torah told us that a heretic can't serve as a Temple priest, I would have said that's because his heart isn't aligned with Heaven. However someone who didn't fulfill circumcision, their heart is aligned with Heaven, so I would have thought they could; therefore the verse (Ezekiel 44) spells out that both the heretic and the circumcision-noncompliant may not serve.
(A similar quote appears in Pesachim 96a concerning who may eat the Passover sacrifice.)
Tosafot (on Zevachim, s.v. arel) observes that we are talking about someone who is obligated to perform circumcision and not doing it, yet we still say "their heart is aligned with Heaven." He says this means someone who believes in the mitzva, but just panics as he fears his child being in pain.
One of the other commentaries on that subject -- afraid I haven't found it off-hand -- suggest another case of "they're not doing when obligated, but their heart is in the right place" -- would be if only one previous child died of circumcision.
So if the parents couldn't do it again, we'd say they're wrong, they are still obligated ... but we certainly understand where they are coming from.