Watching the acid bath sequence, it's quite clear that it's impact has been overblown over the years. It's obvious that The Doctor doesn't actually push one of the guards into the acid bath, but the other guard actually pulls him in himself (Raising another question altogether - why does the guard want so badly to have his friend share a grisly death in an acid bath together?). It's The Doctor's smug reaction and James Bond-esque humourous quip afterwards that is now seen as more troubling, but is it really? The Fourth Doctor and Romana were rampantly indifferent to seeing Rohm Dutt dragged to his doom by one of Kroll's many tentacles in one of many instances that Tom Baker's Doctor proves that his incarnation is probably the most callous of them all.
Near the end of the episode, when The Doctor rigs up some poisonous vines to instantly kill his pursuers, he does it as a last resort, having been literally backed into a corner. Once the deed is done, he is almost overcome with regret. He has done what he had to in order to survive and protect his friends, which goes a long way to erase his questionable acts from Episode One.
But while The Doctor's actions improve in this episode, other characters move in to take his place. Quillam is an angry, vile man. His motives are entirely sadistic, and his description of what he wants to happen to The Doctor and his rebel friends is florid and grotesque. If Quillam wasn't going to kill them, then those two nappy-wearing cannibals were next in line. Overall, Varos is a very grim place, which was the artistic intention, but that point is stressed far too much over the course of the story.
Not all of Vengeance on Varos is bad, though. Nabil Shaban is the obvious highlight, bringing so much to the character of Sil that he instantly makes the little Thoros Betan the most memorable villain in Doctor Who in some time. Martin Jarvis is marvellous as the weary governor and brings some nice little touches to the role, my favourite being his awkward parting handshake with The Doctor, unfamiliar with the custom, but then offering a much more confident hand towards Peri.
But the best bit of the whole story are the two average citizens of Varos, one (Arak) who is a simple, common, working man who disagrees with everything the government, and his wife, Etta, who is loyal to the core, and would sell her own husband down the river (and she almost does) if it meant maintaining her support for her beloved governor. These two characters never interact with anyone else throughout the whole story. They are there merely to provide commentary from the outside, which is incredibly rare in Doctor Who. Even rarer, and even more delightful, is their puzzlement at the end when the old way of life is cast aside. Such a thing happens all the time in Doctor Who, but we never see it from the viewpoint of those who it effects most - the common man. The last shot is of Arak and Etta staring blankly up at the the TV screen that has kept them placated for so many years, now blank.
"What do we do now?" "Dunno." A brilliant ending to a so-so story.