Hey, I just skimmed over the thread... but here is what I know.
a) Angela's "wardrobe malfunction" was not televised, that I know of (but I'md the wrong person to ask). The reason is clear - full nudity is prohibited by the rules of the parade, so when her cover fell out, she RAN for cover!!! Had she not done that, the samba school could have lost precious points and risk losing the competition altogether. That would mean she'd be shunned forever from samba schools. After that happened, she put on an "emergency" bikini that had been set aside for this contingency. It's hardly the first time one of those fall, because of the sweat and the dance.
b) full frontal nudity is ok on TV since the mid-90s, at the very least. Nipples, since the mid-1980s. NSFW, but google-image the word "Globeleza" and see what I'm talking about. Somewhere in the mid-90s that lady had the glittery bikini flying off entirely, while she danced wildly. It was fast, but nothing was left to imagination, really. Oh, that was like 20 times per day, for 30 seconds, on Globo station.
Or youtube "globeleza 2007" and see what's on TV every other commercial break, at Globo. Very very NSFW. edited to add: it's been on TV since mid-Jan, and will be finished only when Carnaval is over.
c) The Carnaval parade used to have much more nudity than it does nowadays. Even naked breasts are rarer, when in the past virtually ALL women would pull out their tops during the parade.
d) Kids participate in the parade, yeah, seeing half-naked people. What's the problem, again? I went to the Sambadrome for the first time when I was 9. I loved it.
e) Angela Bismarchi was beautiful before getting married to a plastic surgeon and overdoing it. Now she does look like a flotation-device drag queen on steroids. But she's some sort of celeb, and they always buy their way into the spotlights.
Partly-naked women are just a small part of the show. It's the one that draws the attention of foreigners but, for us, it's just a way of celebrating beauty. If you must know, what gripped the attention of the nation this year is that one samba school put its 300 percussionists on a float! Can you imagine? The public went delirious! Then when the percussionists climbed down, fake percussionists occupied the float, all 300 of them, while the real one completed the parade, on foot. And another float that came upside down? And the fireworks coming out of a lady's skirt? And a tall Egyptian pyramid being made and unmade in a few minutes? Doesn't that sound wonderful??

Well, those are hard to explain. But, my, the percussionists just rocked the Sambadrome! That's the talk of the town.