Democracy Project is upset by this incident. InstaPundit seems to think the suicide bomber might be anti-Semitic. But this is a Halloween party, no? In recent years, people dress up as positive things for Halloween, too (my boys were Pooh and Tigger) but I had thought the tradition was to dress up as scary, often nasty people. One of the kids in the neighborhood this year was dressed as a '20s gangster, complete with a plastic machinegun. Pirates are pretty common.
You're told to dress as someone scary. A suicide bomber is scary. It should probably be scarier than a skeleton or a ghost. Sounds like you did your Halloween duty. And I don't think that wearing a costume for Halloween endorses the likely sentiments of the person being depicted, be he pirate, bomber, gangster, or zombie.
Now there is a more complex argument, I suppose, that could be made: wearing a costume suggests that the depicted person's activity is a laughing matter. I take it that this would be a possible objection to people's dressing as Nazis for Halloween. I should say that I wouldn't object myself to people's dressing as Nazis for Halloween; still, I assume the sensible argument wouldn't be "by dressing as a Nazi you're endorsing Nazism" but "by dressing as a Nazi you're suggesting that it's OK to use Nazis as a subject of light-hearted fun." Yet even this isn't that persuasive an argument in my book. There are contexts in which light joking about suicide bombers or Nazis might be strikingly inapt; a Halloween party, on the other hand, doesn't seem to me to be one.
UPDATE: Instapundit asks: "Would a university President really pose for photos with someone in a Klan outfit, or wearing blackface? I find that hard to imagine. And if not, why is the suicide bomber outfit OK?"
Two thoughts: First, I would likewise defend someone who came to a party as a Klansman. Same theory — Klansmen are scary; Halloween is about scary costumes; Halloween is not about endorsing the characters you're dressing as. (I'm not keen on the blackface taboo, at least when used to forbid all attempts by whites to try to play black characters at parties; but for this post I'd like to focus on costumes that fit with the Halloween theme precisely because they represent scary evil characters.)
Second, I don't know the details of the pose with the university president, but let's not assume that she deliberated much about the matter. A Halloween party at the university president's house to which students are invited is likely to be a huge affair. I suspect that Saadi wasn't the first person who posed with her.
The president's main job at the party is not to police costume choices but to be nice to the attendees. If she's asked to pose with someone, the default reaction is "OK, let me get this over with quickly, and move on to mingle," not "Let me think about the person's costume to see whether it's suitable for a Picture With Moi." Even if you think that on careful reflection she should have said "No, I won't pose with you because I find your costume in bad taste," I doubt that careful reflection should be expected here.
And, no, I don't think that now that she has had time for careful reflection she should put out a formal apology / clarification / statement praising peace and distancing herself from terrorists or those who would wear inappropriate terrorist costumes. It's a student dressing up for a Halloween party, for heaven's sake.
FURTHER UPDATE: In the paragraph marked "First," I meant to include one more item, but with the lateness of the hour forgot. It may well be that dressing as a Klansman to a Halloween party would have caused a fuss, from a refusal to pose to protest marches to disciplinary measures. But because people have lost a sense of perspective as to some set of costumes doesn't mean that we should encourage them to do the same as to others. One can certainly condemn those who use a double standard (though it's a little harder if you're just conjecturing that they'd have a double standard, since you have only a hypothetical case to compare against). For the reasons I gave above, however, we shouldn't avoid double standards by having a single standard of outraged condemnation.