Ernie and Bert vs. Mash-Out Posse (via Patrick Appel at Andrew Sullivan's blog). It's not quite Hitler as Biggie Smalls but it's inspired all the same... As inspired as this trailer for Sesame Streets (sic) as imagined by Martin Scorsese.... or Pulp Muppets. (Sam the Eagle makes a perfect Christopher Walken.)
The genre gets more perverse the deeper you dig: Kermit as Ice Cube; Elmo and the Cookie Monster doing the Geto Boys' "Mind Playin' Tricks on Me"; REM doing "Furry Happy Monsters."
Photo of Jim Henson statue (with Kermit) at the University of Maryland by Flickr user zhurnaly used under a Creative Commons license.