I'm trying to evaluate the integral:
$$\int_{-\infty}^{\infty}\frac{\sin^2{x}}{x^2}dx$$ with contour integration and am not sure if the basic idea of what I'm doing is correct.
I know that $$\sin{x} = \frac{e^{ix} - e^{-ix}}{2i}$$ and thus $\sin^2{x} = e^{2ix} + e^{-2ix} -2$.
Thus, can I solve
$$\int_{\infty}^{\infty}\frac{e^{2iz}+e^{-2iz} -2}{-4z^2}dz$$ using the indented semicircle contour and take its real part to obtain the solution to my original integral?
Your method almost works. Note that the integrals $\int_{-\infty}^{\infty}\frac{e^{2iz}}{-4z^2}dz$ and $\int_{-\infty}^{\infty}\frac{e^{-2iz}}{-4z^2}dz$ require different contours.
Alternatively, note that $$ \sin^2x = \frac{1 - \cos (2x)}{2} = \Re \left( \frac{1 - e^{2ix}}{2} \right) $$ So that we can calculate $$ \Re \left(\int_{-\infty}^{\infty}\frac{1 - e^{2iz}}{2z^2}dz \right) $$