Do you honestly believe that the Queen should have stepped in? That would have been totally undemocratic, and it would have undermined constitutional part of constitutional monarchy.

If Queen Elizabeth truly believes that her government is in error, it is her sworn duty to refuse Royal Assent to erroneous laws, and use all her reserve powers to correct it (when asked, 'Will you to your power cause Law and Justice, in Mercy, to be executed in all your judgments?' at her coronation, she answered, 'I will').

Yes, it would provoke a constitutional crisis (which is British political speech for 'we want to change the rules, now that someone is playing by them'), and it would very well lead to the end of the Windsors, and probably the monarchy. But it would be her duty. That's the thing about duty: you have to do it, even when you don't want to, and even when it may cost you everything.

I don't think she should have stepped in in the instance of the war, but she definitely ought to step in if she believes her government is unjust or unmerciful.

If a decision is unpopular with the large majority and it is morally wrong, then yes.

Otherwise, what is the point of having a head of state?

The Brits don't have a constitution or a constitutional monarchy.

Sure they do. Just not a single written document with a big heading "Constitution".

Sweden is kind-of in the middle. They have their constitution written, but in four documents.