Um, well, I can see both your points. The other child MAY have some problems at home, and it would be a good thing to teach your son not to hate or make fun of kids who make poor choices. But, your husband is also right that your son needs to know how and when to defend himself, if not in this situation than in others.
I was picked on a lot as a child, and made fun of in high school, but I learned that people respected me for holding to my views, and for defending myself and others when I felt the situation warranted it. I did not respect myself when I did not defend myself or others. There are other ways to defend oneself than with violence, but sometimes that's necessary too. I wouldn't want my son to let empathy and understanding cripple him in doing what is right. At any rate, boys respect and/or don't meddle with other boys who show they can take care of themselves. Perhaps that's why some kids bully. I do know that my husband was bullied mercilessly in middle school, but when he finally fought back, people left him alone, because they finally saw that he was capable of winning a fight, but chose not to fight. He was still home schooled for high school, though, because not everyone stopped bullying him.
Finally, my best friend in 8th grade had two younger brothers, and one day I was visiting and they locked me and my friend's next younger sister (also a close friend) on a balcony. Once they unlocked the door, we rushed and tackled them and I twisted one boy's arm behind his back (enough to make a point, not enough to injure) and made him promise not to do that again. And after that day these two boys LOVED to see me. It struck me as weird - I thought they would have hated or feared me - but I think in the world of boys, I'd made my point, and there was no further need to discuss it. So, you may want to give more credence to your husband's perspective, since he is male himself and intuitively knows how boys' minds work. :)