Is there anything else they can ban? For instance could they ban any reference to evolution or anti-war speech?
I think they can ban categories -- Evolution or Creation, pro- or anti-war. Again, it is the school's graduation exercise and they can and should keep it for the students, not the individual speakers. They can even insist on a tone -- keeping the proceedings upbeat, for example.
You are leaving out the context. In the hallways, kids should be able to talk about anything they want. Even in class, kids should be able to express ideas that the instructor disagrees with (as long as they are not disruptive). But for this excercise the administration can keep a tight reign. Otherwise, the Black Panthers could insist on getting on stage and delivering an anti-honky speech. The process of selection of speakers is as much "censorship" as selection of the material those speakers use.
The 1A is NOT absolute. This time the school was right.