Bingowings said:

As a sort of evil genius myself I can appreciate the stratagem.

Those Senators would probably rally behind someone in the future (someone like Luke or Leia) so Palpatine is throwing a controlled catalyst into the Petri dish of potential traitors.

He creates a designer hero with pre-attached puppet strings.

If the Senators stay loyal Palpatine has nothing to worry about from them. If they fall for the bait he can lead them with his puppet to a luxury cell on the new Death Star (proving it's cost effectiveness beyond the planet smashing).

Hubris leads him to believe that even the cock-up was a victory of sorts.

I would have created a moon-sized planet shrinker myself, maybe in black and sort of worrying in shape (that's always a memorable feature in a weapon of mass destruction).

I can almost see that (your explanation for Palpatine's logic... not sure about the planet shrinker). But it's the definition of overkill. Starkiller says that Sidious and Vader allowed him to destroy Imperial property and slaughter what are probably thousands of troopers and officers in his career to "sell the deception". They're wasting vast resources that makes the Death Star's construction look frugal.