[sourcery]

a Hawaiian private school can favor Hawaiian natives

Enough said: It's a private school, case closed. What Congress may or may not want is irrelevant.

The only issue is the fact that private schools aren't generally allowed to admit or deny students as they please.

[GSlob]

"The only issue is the fact that private schools aren't generally allowed to admit or deny students as they please."
- Is it connected to the tax-exempt status?

[Sandy]

What Congress may or may not want is irrelevant.

The court is construing a statue, so what Congress may or may not want is actually all that matters.