I do have to agree that when everyone gets a trophy, said trophy is meaningless. He was basically saying that existing doesn't entitle you to shit. He's actually telling them not to conform, but if they want to be special, to go out and earn it.
Churning out cubical slaves is giving everyone a participation trophy. Telling them that no matter how poorly they do, they are still worth something. So, should they end up in a crappy, demeaning job, well, they're still special! There's nothing wrong with underachievement. Or, worst case scenario, their taught that the world owes them something for breathing.
All of this coddling to kids' egos isn't doing them any favors. Yes, losing sucks. That's life. When they go out into the real world their are no participation trophies. You work hard and do your best, or you get trampled on. Sometimes you still get trampled on, but at least you tried. Parents better not dare spank their kids, because it instills them with fear (only fear of doing something bad and getting caught... but I digress...) Life is scary. No one will cater to you. No one will stroke your ego. Out in the real world, unless you have something to offer, you're nothing.