Germ war is difficult and doesn't kill people (or so the bods at Porton Down have told me).
The advantage of a small nuke over a plane is that once you've got it, it can be smuggled into another country – like drugs – and let off where you want, whether that's Bombay or Boston.
I'm surprised that no group has tried to develop air-blast weapons like the US' Daisycutter, as the materials are not too hard to come by and the effects impressive in the right circumstances