Don't get me wrong msshadow I think any sort of bullying and name calling and violence is wrong. I do not for a second think that any child or parent should put up with it. I just don't think that hitting back is ever the answer.
In the example you gave you talked about how a child was calling your dd 'a spaz'. Now you may see that your ds 'decking' him has resolved the problem but has the child's attitude changed as a result of your child's action? Is the school doing any more to promote positive attitudes towards disability?
And what will your son do if he takes that approach in later life? If he is bullied in the workplace for example?
In my college he would probably get immediately expelled.
And while occasionally I hear about these cases where X kid stood up to Y kid who was the school bully and Y kid automatically learned the error of his ways and stopped being a bully (especially in story books of a certain era) I've never actually seen this happen in 10+ years as a teacher.
What I have seen is X hits Y, Y hits X and there's a fight. Both x and y deny instigating the fight. Parents of each child back up their own child and so on.
I've also seen a case where Y started carrying a knife (for protection!!?) and got automatically exluded from school as a result.
And plenty of cases where when Y stands up to X, Y gets his mates on the case or waits till X gets off the bus and so on.
While a parent may be acting out of good if misguide intentions advising their child to hit back is very, very, rarely going to solve the problem of a bully and almost always exacerbate it.
And, as I say, in perpetuating violence it undermines the school (and probably your own message at home) in terms of how children should learn to manage conflcit.