[Jack_]

Isn't the point of the episode to show racist/xenophobic stereotypes and behaviour in a negative light? So yes, while it seems a bit problematic to portray a non-English speaking mixed race girl as an alien (well, no, that is problematic), the point is that she ISN'T an alien that should be outcasted, the fact that three of the kids stand up to Michael's taunting proves that. Tracy giving her the art set at the end is the 'kind gesture' that resolves the episode too. If it had finished with her laughing and shouting 'BOG OFF' again as she walked out the door, then it might've been different.

Most if not all children's TV shows have underlying moral lessons they're trying to teach kids. I mean the show itself was set in a care home and tried to show kids in care in a positive light. So no, I wouldn't call it racist really.