As someone who lost three hats, I have no problem with what Valve did aside from the fact that I think they could have spent their time doing much better things for the game, though some of that is obviously based off my hatred of the drop system.
Banning people for halo/non-halos is stupid, immature, ect. The idea of in-game racism is fascinating, though. I wouldn't mind it if it was playful.
As for all this "well good, it was a bad server then," crap, chances are your favorite server has one dick with power that you're willing to ignore. Don't take this as me justifying this behavior, I'm not, but everyone is a bit....hysterical right now, if you really think you're the bigger man (and everyone on the internet does), you'll take that into consideration.