It would have given great offense, had anyone known it was there. For the first half of the 20th century, an eight-foot-tall marble statue of the Prophet Muhammad overlooked Madison Square Park from the rooftop of the Appellate Division Courthouse at Madison Avenue and 25th Street. Sixty years ago, the statue was quietly removed, in an episode that now looks, in light of recent events in Paris, like the model of tact, restraint and diplomacy. What had spared the sensibilities of Muslim passers-by from 1902 to 1955 was that “Muhammad,” by the Mexican sculptor Charles Albert Lopez, was among nine...