After much aggravation I finally figured out how to solve this, and someone already posted the answer but here it is again for anyone who just skips to the end for the answer instead of reading all of the arguing in the entire thread:
If there is music that you have purchased (or been gifted or whatever ) in your iTunes account that you want to disappear:
Step 1) on your computer, go into iTunes. Click on the "purchased" tab
Step 2) find the unwanted music (in this case: the pesky 'free' U2 album)
Step 3) click the X in the corner of the album art, that should inform you that you will be 'hiding" that music.
NOW - very important- anyone using the "show all music" feature on your iPhone so that you can stream your purchases with out having them take up hard drive space on your phone... you will notice that the U2 album is STILL there with the little cloud symbol next to it. and no, you cannot just swipe and delete it.
STEP 4) on your iPhone, close out of the music app.
Step 5) on your iPhone, go into settings and SIGN OUT / LOG OUT of your iTunes account.
Step 6) now log back into your iTunes account.
Should be gone. This worked for me. I got rid of U2 and a few other unwanted things... now I can shuffle and stream all of my purchased iTunes music without U2 being there.
I DID NOT HAVE TO RESET MY ENTIRE PHONE TO FACTORY SETTINGS
I DID NOT HAVE TO RESTORE FROM BACK UP
!!
Once I figured out what to do, it took about 3 minutes to get rid of U2.
Hope that helps !!!