There are no clear and authentic texts forbidding the depiction of the Prophet (peace and blessings of Allah be upon him) in the Quran or the Sunnah. There are some debatable hadiths that forbid drawing images in general, but many mainstream scholars today consider drawing things to be acceptable in Islam (such as Shaykh Yusuf al-Qaradhawi, president of Ittihad `Ulama al-Muslimeen - World Union of Islamic Scholars).
There are historic depictions of the Prophet, such as from the Ottoman period, done under the Ottoman Sultans, who were Orthodox Muslims. The Islamic rulings forbidding the depiction of the Prophet come from the last half of the 20th century, from al-Azhar and other institutions, and are all debatable.
The entire issue is about respect. Is it respectful to create drawings of the Prophet or name objects with his name? It is not a 100% clear issue regardless of what some might say, but as a Muslim who wishes to gain the favor of Allah, I'd take the safer road of not depicting him or naming objects with his name.
But, if someone else does it, in my opinion it doesn't necessitate the least bit of attention or condemnation. In Islam, according to the Fiqh al-Awlawiyyat (the Law of Priorities), what is clear and distinct wins over what is unclear and debatable. Kindness and forgiveness are clear and central tenets of Islam, while it is debatable whether depicting the Prophet is forbidden, for this reason the situation requires kindness and forgiveness, not condemnation.
If a person creates an image of the Prophet, he has done something questionable, but people do questionable things all the time. If the person did it with a good intention, then his intention is what counts.
And if the person did it with a bad intention, it should be left to God to deal with him and the Muslims in general should simply avoid and ignore him as the Quran commands when dealing with such people (7:199, 6:68, 28:55).
The Quran doesn't even include any punishment or condemnation for people who make fun of Quranic verses, but simply asks Muslims to avoid and ignore such people.
Those who make a big deal out of people making fun of the Prophet or the Quran haven't understood Islam correctly and are trying to fill an emptiness and purposelessness in their own lives through hating on some random fool. If those people who are so quick to join anti-depiction protests were as quick to help the poor, to go and plant trees, to fix roads, or to read Quran, their countries would have fewer problems.
But since it feels so good to hate and be angry at someone (it makes one forget one's own faults and shortcomings), these people would rather do that instead of planting a tree or cleaning up a road, things that don't give you adrenaline rushes and don't usually get you TV coverage.