The performance, of course, was of Eve Ensler's play "The Vagina Monologues." The play is a collection of stories in which women talk about their privates. It attempts to help women see that this body part should foster no shame. The play is now performed by school groups virtually everywhere, frequently causing controversy.
The principal of the Westchester County school says that the issue wasn't so much that the girls said vagina, but that they disobeyed prior instruction not to say the word. That's an interesting distinction.
Once again, it's not about the transgender surgery, it's about the betrayal of trust.
What this little incident helps to illustrate, though, is a point already driven home in recent days by reaction to Ann Coulter calling John Edwards "a faggot." This is someone who said women whose husbands were killed during 9/11 reveled in their widowhood and took less flak for it than she has about this "joke."
Political correctness these days is not about the ideas you express, but about the words you use.
Update: Paul Rudnick has a humor piece about inappropriate words in kid lit in The New Yorker.