I definitely feel that nukes should be MORE DESTRUCTIVE-though more in their 'lasting effects'. For instance, pollution caused by nuclear war or meltdowns should NOT be as easy to clean up as that caused by over industrialisation. Nuclear weapons should also cause a 'plague-like effect' where people can continue to die, long after the original radiation has been cleaned up. Unlike plague, though, this would be limited to the city hit by the nuke!
I do agree that using a nuclear weapon should cause unhappiness in your own Civ, with the actual amount being tied to how many you use, the international reputation of the victim, the culture group of the victim, your civs characteristics and your current government type.
Yours,
Aussie_Lurker.