Dr. Rice would probably overlook it as you say but this also affects all the black students at the college especially those who had to answer this question!
Just substitute the name 'Martin Luther King' and I think you'll get my drift!
What is the worst implication that you can draw from this? - That black people like watermelon more than white people? That is not a in implication I would want to extend effort to see censored because it indicates belief in a stereotype but not prejudicial action based on the stereotype. I generally don't support punishment for beliefs but only actions.
For example, I had an economics professor who said anybody who believed in Reaganomics was ignorant. He and I argued through three quarters about all kinds of things. But he graded my papers fairly, gave me the "A" I deserved and recommended me for a fellowship. He has stereotypical beliefs but I have no problem with him being a professor.
Now, probably, the person that made this question up is a racist. Probably he is anti-conservative. If there is a pattern of prejudice by him then that is a different situation but based simply on this test question I don't see a basis for action. The most I would do is look and see if there have been other incidents involving him. YMMV.