Why should I keep punching the bombs?

The point of hitting the bomb is so the bomb move faster and it does more damage to the structures before exploding. If you just hit the bomb of at about *25% it will only be able to damage the the two types of wood blocks. At around *30% percent you can start to damage the light grey stone blocks and *40% you can damage the dark grey stone blocks.

The higher the percent the better because the bomb will lose speed with every hit to the structural objects. It does not affect the bomb's explosion, just how the bomb moves.

*Rough estimates based on game play over the last few days.

The higher the damage on the bomb, the farther and faster the bomb will fly. After some testing, I determined that damage does not affect the size of the explosion.

This means that damaging the bomb is designed to simply be a trajectory modifier, so higher damage isn't always better.