The most traumatic event in the life of my grandfather was the witnessing of the sinking of the Cap Arcona in the Neustadt harbor where he was doing ambulance service as a sixteen year old boy. Why did the Allies bomb these ships ?
The Cap Arcona, when it sank, had 5000 Concentration Camp prisoners on board. It was left in the harbour at Lubeck if I'm right, on Himmler's orders, the idea being that Allied aircraft which were flying missions against German naval vessels in the Baltic, would think it was evacuating troops, and attack it.
A fair number of smaller, military vessels (destroyers, torpedo boats) were nearby when it was attacked, so it is likely that the plan worked. The pilots attacking it probably thought it was carrying supplies or evacuating troops; there were fears that Germany's forces intended to fight on in the north and in Bavaria/Austria, so such a target as the Cap Arcona was unlikely to escape attention. There were boats nearby, and troops on the shore, whose job it was to dispose of any survivors.