At MIT, the word "hack" means something very specific, and not criminal or unethical. It is a impressive, creative, and clever achievement.
The word hack at MIT usually refers to a clever, benign, and "ethical" prank or practical joke, which is both challenging for the perpetrators and amusing to the MIT community (and sometimes even the rest of the world!). Note that this has nothing to do with computer (or phone) hacking (which we call "cracking").
So, the president of MIT was urging MIT students to pull clever practical jokes? That's stupid or he meant something different. Presumably he meant "hack" in the same way that people who have been actually involved with computers understand it: exploring the possibilities of a system (often including some that the inventor never intended) for the sake of discovery and in some cases using those discoveries to create unique and innovative outcomes. I get that you are trying to make a distinction between "hacking" and "cracking" but "hacking" has a meaning that transcends the special case of practical jokes that are a part of MIT folklore and if the president of MIT did not have the broader meaning in mind, then his comments are almost comical.