I dunno really. At 9 i think they are old enough to know and discuss the issue, though if there should be a photo up on the wall is debatable. Some people/children may find it 'distasteful' (not sure of correct word to use) And it is a childs work, so would that create an issue if the child was told "no, yours isnt going up" when every one elses was.
When we were 5 our classroom had a sheep skeleton hanging up, for no good reason (this was a primary school in the middle of London so not a local)! His name was Baaaaa-rry, he got decorated for christmas/easter etc .
It's important recent news & a child made it, I think it should be up on the wall.
No horrible. Yes it's news but graphic pictures that could effect sensitive children shouldn't be on show. Not really sure why the child wasn't steered away from using the picture by a responsible adult.
YANBU - that picture isn't even real, it's a fake. I would have told a child in my class (and I teach secondary) that it was unacceptable. Even 6th formers, to be honest, unless they could give me precedent of comparable print newspapers running such pictures (don't think it was in any print newspapers, only online).