Personally, I think the parents and Michela Roth's school overreacted in this situation. None of the photographs were around any of the children. The children were never around any of the modelling sessions nor otherwise exposed to it.
Plus, these are nursery school children. They haven't figured out how to work Google yet. It's not like they are going to find these photos of Michela Roth and develop some "hot for teacher" fetish.
In the end, the only person that I think should be fired was the photographer who took the pictures such as the one above. Harsh direct lighting on a 38 year old model? What was that person thinking?