Of course parents have the right to take their kids out of a bad school. If they feel their children will be better off home schooled, then that is completely their choice. No one but the parents should dictate how their child is raised and educated. Education is one of the most important issues in our society, and parents must have a say.
Home-schooling robs children of something essential about education: learning from many different voices and points of view. If you're only learning from one individual, they can only teach you from their own knowledge, history, and experience. When opinions are involved, children are only exposed to one, there is no debate, and no free-thinking. It also deprives children of something so essential to development: socialization. Learning to make friends and be around many types of people better prepares them to make connections with others in the future.