If I have two "Defence Protocol" objectives in play, can I deny myself two cards and do two damage to enemy units?

Short answer: Yes.

Wow! Cool! Seems to be just too easy to kill units but I'll take it!

Sacrificing cards to advance board position isnt a bad thing, it all depends on what you have in play and what advantage you will get from damaging those units. If I have some units and one of the big DS units then I wont mind losing a couple of cards if I can push through some damage to kill a couple of units.

Not a bad thing at all, just a situational thing. Sometimes you'll want the cards, sometimes you'll want the damage. For extra fun, have Recon Mission as the third objective out :-)

I had a game where I had two counsel of the sith and a reconnaissance mission in play, that was a strong setup. I was able to play cards or engage with a couple of units on my turn and not worry about playing out my hand.