Questions

This is a perfect example of 'missing the context'. Muslim scholars have been explaining this hadith for many centuries, but opponents of Islam ignore all that, they just love attacking its 'face value'.

 The story behind this hadith goes like this:

 Two brothers (companions RA) came to the Messenger PBUH and said that their mother had died before Islam (in Jahiliyya era), and that she had buried her daughter (their sister) alive. Therefore the Messenger PBUH said the hadith above. Some scholars said that this is a particular case where Allah SWT (God) Knows what would have become of the baby had she grown up to become an adult, and they based this explanation on the case of the child in Surah Al-Kahf, where Al-Khidhr explained to Musa AS (Moses) why he killed the boy:

[18:80] And as for the boy, his parents were believers, and we feared that he would overburden them by transgression and disbelief.

Some other scholars explained this hadith with the fact that in the classical Arabic language of the time (in cases such as this one), Al-maw'oodatu means Al-maw'oodatu lahaa (where lahaa can be removed/omitted with the meaning still preserved). Therefore the two people being punished in hell would be:

Al-waa'idah = the woman who actually carried out the act of burying (on behalf of their mother), in the traditions of the time: the midwife.

Al-maw'oodatu (lahaa) = the woman instructing the burying (i.e. their mother).

Therefore, once again, the problem is with the translation, not the hadith. I think the translator should have added a note explaining variations, allowances and particularities of the classical Arabic language used at the time of this hadith.