This has become an interesting controversy.
This is due to the fact that Disney not only bought the Muppet characters (as in characters from The Muppet Show, and it's succeeding movies), but in their greed, have trademarked the term "Muppet" as their own. Now, because of this, some people feel that other characters no longer count as being "Muppets", such as the Sesame Street characters, Fraggle Rock characters, even the Puppet Up! characters that appeared on last night's Grammys, and other such characters from other Henson projects (that are NOT under Disney's control).
Now, sure, legally, they CAN'T be refered to as "Muppets" since Disney owns the term, and does not apply them to these other characters; if you ask me, I feel that as long as the characters originate from, and are conceived by the Jim Henson Company, the Jim Henson Creature Shop, anyone working for Henson, etc, they are still "Muppets", either way, and I believe Sesame Workshop feels the same way, as the closing credits for Sesame Street STILL refers to the characters as "The Muppets of Sesame Street".
What are your thoughts?