Why did he say "b'Zos Echros Bris"?
Malbim: Making a Bris is always for some matter, e.g. if you will [not] do evil to us, just like we did not harm you", "like the Chesed that I did with you, you will do with me" (Bereishis 26:29, 21:23). A statute of nations is that if they fight against a city, and they make peace immediately, they make a Bris with them, as reward of not fighting - if they could have fought. However, if they would surely be conquered, they will not make a Bris; they will do as they want to them. Therefore, I agree to make a Bris only if you let me remove every man's right eye.
Why did he threaten to remove each right eye?
Rashi citing Midrash Shmuel 14:7: He meant, give to me your Sefer Torah, which was given with [Hashem's] right hand, and I will burn it, for it says that Amonim may not marry into Klal Yisrael.
Malbim: It will be as if I defeated all of Yisrael, for they were unable to save their brothers! 1
If they were able, surely they would have saved them from this! (PF)
What is "Cherpah"?
Rashi: It is insult.