This story has been reposted to HN a few times over the years. My reaction to this particular repost was to feel intensely guilty that so many people were still being tricked by the same old snakeoil. Then I looked up what the author had done in the subsequent years, and it's a pleasant surprise: DeMarse has worked on some wonderfully interesting projects which are quite unique.
I'm glad that I never tried to expose this "brain in a dish" as the lie that it is. Everyone deserves to make a mistake once in awhile, and his, I think, was merely to be flattered that reporters were interested in his work at all, which is quite a natural reaction. I'm sure he regrets that he wasn't as careful as he should've been with correcting the reporters' assumptions.
I don't know how to feel about that. If you find some time, would you mind evaluating my write-up at http://news.ycombinator.com/item?id=97299 ?
I'm wrestling with the moral implications of a scientist riding a wave of unfounded hype to raise public money for his own lab. Also, I don't know if that's an accurate description of what happened; it seems that way to me, but I'm worried I'm wrong. I'd be grateful to get your thoughts (and anyone else's).
Here is the pertinent reference in DeMarse's paper: http://www.jneurosci.org/content/23/28/9349.full.pdf+html
Now to answer what you asked me about. Do I think what DeMarse did is morally right or wrong? I do not want to pass judgement because I am still in school and don't have to worry about funding my own research. A professor I respect for his scientific integrity told me every scientist has a skeleton in their closet (referring to research projects). I think the fact that DeMarse's paper caught on like wildfire just goes to show you that a majority of Humans (computer programmers included) can be relatively stupid.