I've been to Bhutan. It's a very interesting place, and the people are really heartwarmingly genuine.
As for the exile problem, you have to understand that Bhutan was completely isolated from the rest of the world until fairly recently, and they still have an isolationist attitude about many things (when I was there in 2001 they had only recently got television, and even then it was only available in a couple towns). They are very concerned about maintaining cultural purity, which has allowed them to avoid many problems of the outside world. The people who they have exiled came to Bhutan from Nepal in search of a better life. Bhutan has chosen not to accept them, and I don't think I can say they're wrong to do so - it's their country, after all. Granted, some of the Nepalis they have exiled were actually born in Bhutan, but few Asian countries grant automatic citizenship to anyone born on their soil as the Americas typically do (in fact I have two nephews who were expelled from Indonesia as soon as they turned 18, even though they were both born there and their parents' residency visas are still valid).
One of Bhutan's greatest fears is that they will someday turn into another Nepal, where foreign workers and tourists have run roughshod over the native culture. Going from Thimpu (Bhutan's capital city) to Katmandu (Nepal's) is basically like going from Mayberry to Tijuana.
Once again, they might not be acting the way we'd like, but it's their country and their choice, and they do have their reasons.