As you can see by my user ID I'm Mormon, too (perhaps not for long, but for different reasons than this issue). At any rate, I, too was upset when I read the headline about holocaust victims names continuing to be used for proxy work in temple ordinances, but wondered how this was actually discovered and if it is actually the case. And if so, how the names were submitted to the temple. I mean, can you imagine if the church made an announcement to its members that NO Jews were to be offered proxy baptisms even if they are your ancestors?! That would be, essentially, antisemitic!
The church will not proselyte and forbids members from doing so themselves even with friends in countries when it is forbidden by law in spite of being a very missionary oriented church. So I cannot imagine the church diregarding their agreement on this other issue, as it is essentially the same issue (of not offering what are seen as the ordinances of salvation to those who have clearly indicated they are not interested)...
On the issue of baptism for the dead itself, I'd like to offer a different perspective. Of the religious traditions claiming to have the one true path to God (and Mormonism is not the only path that does make this claim), this practice is the only I know of that really makes it "fair." Does anyone else know of another "we are right" religious tradition that includes a safety net for all of the human family? (In other words, anyone who didn't have a chance--by even hearing about it--to take that road in life?) Jesus said baptism was essential for salvation. How is that fair to all of God's children who never even heard of Christian baptism?
Any Christians among you might want to look up 1 Cor 15:27 about the practice of baptism for the dead, which was also a practice in the early church. I know, some people interpret that to mean those who are spiritually dead, to become, through baptism, spiritually alive. But the Mormon take on it is literal. Also, consider that Christ's Atonement is, in essence, a proxy ordinance for all Christians performed by Christ.
I can't know for sure how I'd feel about someone else doing a religious act in proxy for me (beyond my Savior) since I know of no other religion that does anything like this. I can see feeling insulted. I can also see feeling like I'd like my butt covered in every possible way just in case. :LOL Except that I don't believe in a God of fear, or a God unable to save. I certainly haven't minded when friends and aquaintances of other faiths have prayed for me. But I realize that's not quite the same thing as doing an ordinance in someone's name--like if someone could participate in mass on my behalf (is that possible?). Hey, what about Catholic Saints? Or the lesser dieties in Buddism? Don't they pray on behalf of believers on earth? Or am I misinformed?