After talking with some Apple support reps via email and on the phone, it appears that the album cannot be deleted fully from our accounts. The best that can be done is to hide it (turingtest2 has indicated how).
Apple support haven't been able to delete it fully from my account themselves (although understood my feelings at having content pushed to my account without request/permission), so I have asked to be referred up the chain (as presumably someone at Apple will be able to completely delete it). I will post if this happens.
The Apple Support rep also suggested we could post feedback about this via the form at this link: http://www.apple.com/feedback/itunesapp.html
There are a lot of messages in this thread which (to me at least) come across as angry/baiting each other; please can we keep it civil, I think that's likely to be most helpful.