I don't think that this isn't a straight forward yes or no, well in my opinion anyway.
If you were involved in a major incident and you are with other people who may have been involved with this, sometimes part of process of dealing with this is to joke about it, look at soldiers who are involved in serious incidents, they will joke amongst themselves about things. In a way this is part of the coping process and the glad it wasn't me.
If you have no ties to a major incident I don't think it's appropriate and is rather crass and shows the mentality of the people involved, if anyone tells me a joke about someone elses pain i think alot less of them.
There is no right or wrong. It was in bad taste, they are young and until they feel the weight of loss the event does not faze them. Oh the cruel world we live in.