I am with the blogger on this. If the videos were procured from the gov employee and then posted I am all in favor of pulling them. OTOH the videos were pulled from the department web site which makes them fair game. I think that asking the blogger to remove the videos would be okay.
The issue is that deleting the post does nothing for removing the videos from public viewing. If the issue is, as stated by the department guy, that public posting of the videos might hinder SMN efforts then pulling the post doesn't kill the videos on YouTube; it doesn't even necessarily kill the blog as most bloggers publish here and elsewhere.
It seems that all that was really accomplished was that a blogger was annoyed and a gov department, which has seemingly little grasp on the power of internet publishing was placated.