Guy brought it all on himself. He targets and kills two innocent civilians, two police officers, and makes it very clear he's waging a war and terror campaign against the police.
Are we surprised he was pushed back in? He was as trigger happy as the LAPD, opening fire when a cop was in sight. I don't doubt he came out armed trying to escape, and the police shot at him, forcing him back into the burning house.
The LAPD may not have been their best, but keep in mind that they were scared. This guy was armed to the teeth, with police and military training, no regard for his safety or anyone around him, and he wanted to murder cops and their families. He was a very real boogeyman who could hide from the police and seemingly move undetected. When every cop is fearing for the lives of their loved ones, that's justifiable reasoning that you do everything to end his threat even if the outcome is ugly.
This type of criminal is very rare in America. There just aren't people who specifically target cops and their families, and as such, there's really no way for a department to prepare in case their own people are being hunted.
Dorner may have been unjustly fired, but he had options - lawsuits, talking to the media - but he chose to pick up a weapon and take out as many people as he could without getting caught. He didn't just throw away his credibility and sympathy with those actions, he threw away his very humanity. If he's gone, all the better.