If I recall correctly, the 461 tradition of making a huge Happy Cat and posting it around competitions has been going on for about four years now (it started the year was a freshman in college) and as far as I can tell there isn't any offensive meaning behind it. It's really just there as a silly joke and to be ridiculous. The bigger one the kids hung up at Ypsilanti this year was adorned by another team with a sign that said "I can has robotz?"
I'm pretty sure the tradition will continue.
In addition, I'm pretty sure the 461 Happy Cat predates the NEDM stuff, as a number of the high school members were Something Awful forum members at the time, which was where Happy Cat was first disseminated from a Russian cat food company site in 2003. It's bizarre that people keep history on these things!