That some thought a real person had died during the Wheely thing is something I remember hearing too. So it's either real or a very pervasive rumor. I do know there were several people who were somewhat upset because of personal experiences (or the idea of their child trapped). The question was raised whether Cyan should have used that situation.
Honestly, though, the experience I've had with IC/RP was more that people were annoyed at it, not confused by it.