Most of the "not allowed because it offends" arguement is a load of nonsense like the not allowed to fly the st george flag thing.
Yes you get odd problems like burning of the flag or poppies that sort of thing but these are random ignorant incedents that get caught onto by the media and the next thing you know theres a photo plastered across the front cover of every news paper and no one will shut up about a one off incedent.
Majority of muslims and such have nothing to do with it and in fact most likely have family that benafit from the monies raised by such charities as the poppy appeal, dont forget it wasnt just "white christian" men that fought in wars and the poppy appeal is no longer about just world war 1,2 it actualy raises mony for families and such of every war ever fought even current ones.
So it most likely just another urban myth, nothing spreads quicker then a roumer thats going to piss people off.
2 years ago it went around our town that we where not allowed a remeberance day parade because the council had banned it for fear of offending muslims and germans
it was even in the local paper with loads of dear editor type letters of people voicing thier discust.
The truth of it was the local organisers had forgoten to put the paperwork in for permision to close the road off for the parade in time so they joined with the staines organisers in the next town other (their parade is huge)and all the local cubs, scouts, brownies and such all went other their for the day.
But back in our town there was just a few random people paying their respects at the memorial probably wondering where the hell everyone was and of course because of this everyone believed the banned roumer.
I know myself from charity collecting experiances that there actualy is a ton of paperwork, permisions, rules and such that have to be adeared to and somtimes it gets mucked up and you cant collect in a certain area because of it.
What actualy infuriates me is the selling of white poppies for rememberance day but thats a whole other beef