If anyone thinks the objection to the pictures is that they want to hide from/not study Nazism I'm afraid you're spectacularly missing the point.
Ask yourself - why are portraits painted, historically speaking? What is their purpose? (Come on people, this isn't rocket science). Hint - they aren't a real character study, they're glorification.
Or here's another way of putting it - let us say your grandparents, and their friends, and their brothers and sisters and parents, were murdered by, I dunno, say a particular terrorist group or well-known killer, and your childs school decided to undertake this sort of "art" project on them and whap it up on the wall. 30 paintings of your relative's murderer. How would you feel about it? I mean, I'm not Jewish, but if I were and DS's school did this I'd probably boke all over it, it is NOT some dim and distant ancient history, it was fucking beyond horrific, beyond inhuman. Just because you're disengaged from the reality of the holocaust - what was it Stalin said? 5 people killed is a tragedy, 5 million is a number? - is that what you think? - doesn't mean everyone is, or should be, especially the descendants of it's survivors.
There are lots of ways to explore war art in a more meaningful manner than copying pictures of Hitler. And lots of better ways to explore the war in general, I mean there are some really interesting psychological experiments you could run with the kids to explore just how easy it is to push people into obediently doing appalling things, or dehumanise another group of human beings. I suppose they aren't in the NC though...
Personally, I'd say this project was just poorly thought-out rather than malacious, but that having a word with the teacher is a good idea.