I think it's clear whose side El Reg is on.
There's two problems with The Register's coverage of this article, the first being that they are inferring the only reason you'd need the AACS key is for piracy by labelling people pushing for freedom of it's existence as the piracy crowd.
The second issue is The Registers suggestion that posting this would breach UK copyright law, citing the relevant portion of our laws - the problem is that The Register is making the implication that the string in question necessarily even has anything to do with AACS at all. I could post the string and tell everyone it's my password, if The Register then censored it they themselves would be the ones responsible for then making the link with AACS and would themselves be responsible, if however The Register just left it there as something like:
"My password is: <insert key here>"
Then there is nothing to say that this is an infringing string at all, the key point of this whole debate is that you can't copyright a string, because that string could be used by millions of people for millions of things. To bring up an analogy, let's think about knives, the big cake knife sort, if it's used for cutting cakes then it's perfectly legal, if you then take it outside and walk round the high street with it, the police would be allowed to confiscate it.
It's all a question of purpose and intent, the point of the Digg users is that it should be possible to take down a site for posting it, particularly if that site obfuscates the purpose of that key, as there is no evidence then that it's anything to do with AACS - only speculation. If we're to allow censorship of something that might be used for something else although we can't tell for sure because it's obfuscated then perhaps I should send a DMCA take down notice to The Register, for a home movie I made that's protected by a special DRM I made myself that uses an encryption key of "Digg buried by users in piracy face-down", as The Register knows that this is the key for my DRM now, because it's posted here in the comments and as they have my DRM key as a title of one of their articles then is it not exactly the same thing? Should The Register therefore not now rename the article or cease operating because they're knowingly posting something that can be used to infringe on my IP?