Definitely in bad taste, though I guess because it's like 10 years ago it's not as surprising as nowadays. Also, Korea as a whole isn't diverse enough to truly understand the implications of a lot of these things.
They should absolutely be called out for it, but it's hard to truly hate them (unless it's like a consistent thing after they've already been called out).
To them, the racial stuff is prob on the level of smoking weed to Americans. I know more people who've smoked weed than those who haven't at least once in their life. It's just how it is where I grew up, everyone smoked in HS or college. Koreans are known to be prideful to the point of being xenophobic, so them acting like that shouldn't shock anyone honestly (unless they were raised overseas). While as an American, I have no legs to stand on if I wanna act like that. We obviously should know better.