When I was growing up tons of kids would dress up as figures like MC Hammer for Halloween, because he had an extremely unique and ... cool? persona. People still call parachute pants "hammer pants" 30 years after he left the spotlight. It isn't taking the piss out of any race, it's idolization.

There's a massive difference to me between dressing as a person you like (or even someone specific you're making fun of) and dressing up as "a black/asian/white/latino/etc person".

Wholeheartedly agree with you there. Though I disagree with the notion dressing up as undead is insensitive if you're being sincere. It's a comedy show, and they're doing absurd things in the name of comedy. Undead aren't real, and even in the fiction undead is a characteristic, not a race. I see it more like someone dressing up as an army guy to a Halloween party hosted by army guys. It makes you seem like a dork who can't read the room, but nobody would be offended.