At least in hindsight I can say with confidence that John von Neumann was wrong in this matter. Or do you really think things could have turned out better if the US had began a nuclear war?

It is one thing to say that in hindsight he held a wrong belief, and another thing entirely (especially without knowing his exact arguments and priors) to say that he held a wrong belief at the time and was not only wrong, but also therefore morally defective.

I would actually argue for the latter. Even if he might have had valid geopolitical reasons to advocate a nuclear strike (althought I highly doubt it), it would have been morally wrong nevertheless. In my opinion, there is never an ethical justification for the usage of atomic weapons. In fact, I firmly believe that the bombing of Hiroshima and Nagasaki was ethically wrong as well, but I know that other people have a different opinion on this matter.

It is very difficult to conceive of Japan having turned out any better if Kyoto had been destroyed.

I agree, but I think there are many ways of arguing that the destruction of Kyoto was justified at the time that do not involve arguing that it would make Japan better off. And like I said, there is more than one theory of morality :)