Seymour Hersh, in the New Yorker, March 30, 2015:

the U.S. military, convinced that the Vietcong were entrenched in central Vietnam and attracting serious support, made little distinction between combatants and noncombatants in the area that included My Lai.

The problem of separating insurgents from neutrals/loyalists is at the core of counterinsurgency warfare. Nearly fifty years on, We are still coming to grips with just how deep this problem ran in Vietnam.