She made a joke; one that I bet most people didn't even understand (at least not fully).
Was she in any way linking John Edwards to the word faggot? Yes. So what's the uproar, that she made any reference to Edwards and homosexuality or her choice of terms? Did anyone even pay attention to the rehab part of the joke? Do they get what she was referencing? I'd never heard of it, so I doubt many others did.
Isaiah Washington, Dr. Burke on Grey's Anatomy, called a co-star a faggot in an argument, basically outed him. Washington has since gone into rehab for his behaviour (over a month ago, actually). To me, Coulter's joke was 80% noting how stupid it was to go to rehab for saying a word, 20% a jab at Edwards (which is what she DOES).
Even Fox News is mis-stating the story saying Coulter "referred to Democratic presidential hopeful John Edwards as a "faggot" during a speech Friday at a national conservative gathering." Coulter implied an association between Edwards and the word faggot. She basically said she'd have to say faggot to talk about Edwards, but that's not calling him one or saying that she'd have to call him one. Going that far is conjecture and inference. Now we're attacking people for what they're not saying, what we think they say, think they mean. That's bullshit.
Howard Dean has called on GOP Presidential candidates to denounce Coulter for it. Giuliani, McCain, even Romney, have issued statements through their campaign spokespersons to distance themselves from the matter. This is PC idiocy at its worst. Two kinds of people are getting on Coulter about it: the ones who already hate her and would scream over anything she does or says and the people trying to save face in public relations. We're so far entrenched into a society of demonizing people for being "insensitive" (read: not following a dictated line) that few people have a shred of integrity left in them to call a spade a spade, to be open and honest about things. The more you hide to avoid offending people, the greater risk you run OF offending them because you've dealt them all the cards, handed them the whole bloody deck. They tell you it's bad to say A, B and C, so you avoid saying them. Now they're going to attack you for D, E and F until you avoid those too. You're submitting to the will of others, to peer pressure, to mob rule. Stop it.