The uproar over this particular experiment seems like a bit much, but it doesn't hurt to start to have these conversations about research on users using the web. There is only going to be more of it going forward.
There's a reason why psychology studies (any human study really) require informed consent. There is potential for great damage and Facebook apparently doesn't care.
Now I can hear someone saying that advertisement is the same thing. Advertisers are trying to change peoples' emotions, yes, but we know and recognize that while watching an ad. People using Facebook do not expect to be manipulated like the study did.
I would be just as upset if it were Google or my local grocer.
If this is something that upsets you I suggest being upset at every commercial on the radio / newspaper / tv / billboard that you're unfortunately exposed to every day.
People have been calling out various bad practices in conversion: http://darkpatterns.org/
So it's not bad because everyone else does it?
A real-world comparison of the two different types of experiments:
Grocer wants to see the effect of a product demo's effect on sales. They have a worker offer a product sample, then recommend a pairing of products vs offering a coupon for that product. A/B testing.
Grocer wants to see the effect of a product's demo on the customer's emotions. He has the demo worker gripe about their boss, or talking positively about the community, then asks the cashiers for followup feedback on the smalltalk at their counters.
One of these is OK. The other is seedy.
It is a requirement instituted by the IRB in most universities. That is the problem being mentioned here.
Furthermore, Facebook is a different case from most companies because it is an intrinsically personal website that has the potential to affect a user's life very meaningfully. Amazon changing the design or location of a button doesn't affect me as much.