From what the man said, the cops did infringe on his rights; they had no right to stop him or to remove the sign. I cannot think of any reason his home would be searched. We only heard his story. Is there more to the event?
Apologizing even if you are in the right is being polite. It is not a sign of weakness, it is a sign of strength. It is possible to turn the other cheek without being incompetent, weak, or stupid. However, Obama is still black and I think that may be the point.