This is all true, but, and I hate to say it, there's always been a fairly strong aspect of xenophobia involved here too. Wholly out of ignorance, rather than malice, but traditionally, in addition to the malawareness described by brother the_bear, there's also been a measure of (and I'm aware how horrifying this sounds) "OK, millions of Jews, gypsies, homosexuals, etc. but, after all, they were white. It's not like there were millions of Chinese exterminated". No matter how uneducated the students are, it's pretty unlikely that they would have been OK with dressing up like a bunch of WWII Nipponese soldiers in Nanking and staging fake beheadings and gang rapes.
(And before anyone asks, there still seems to be an enormous inexplicable blind spot among locals when Mao's slaughter of bazillions of Chinese during the GLF and Cultural Revolution comes up, I really don't know why)
The good news is, I guess, that the immediate reaction among the media and politicians etc readily recognized the gross unacceptability of the activity, I didn't see anyone trying to downplay the severity of the offence, like what happened way back in the day with the space heater ad debacles.