Tweeties Trends feature scans the social network to find the most popular keywords that people are talking about. The offensive word was not put there by developers it was shown because thats what people on Twitter are talking about.
Rejecting this update has been likened to banning Safari because it can access objectionable content. Ridiculous.
The situation seems to be worsening each day. Just yesterday saw a developer write an open letter to Steve Jobs because his application to help find missing children had been waiting nearly a month with no approval from the company.
Perhaps more developers should take a look at what Cydia has to offer.