I agree with Simon here. The FIRST Death Star was an example of the Empire's hubris; we're big, we're bad, we can blow up planets... which is the Empire in a nutshell. But after seeing that they could be defeated by the small band of rebels, they should have learned. *Even* if the DSII had already been under construction they should have abandoned it for another idea.

But now that I think about it maybe it does make sense. The Emperor was definately full of himself and perhaps... just perhaps... not many people in or out of the Empire had even HEARD of the Death Star and probably had not heard of its destruction. It WAS supposed to be a super-secret weapon. Palpatine could have been trying to just ignore the destruction of the first one and use the second to not only wipe out the rebels and convert Skywalker but also then continue with the day-to-day threatening of worlds and all that other Empire building stuff. Palps did have a lot of moxie afterall!