Well, after doing a bit of Googling and seeing the story replicated on two sites, both of which are highly dubious in their integrity (nationalreport.net is definitely on my BAD list), I ran onto the following on bullshit-blog.com:
Editors note: Upon looking into the mystery that was ‘Fappy’ it appears the anti-masturabation dolphin is actually an elaborate hoax, created by online trolls targeting the Westboro Baptist Church.
Smells like a combination of POE and a not horribly subtle bullshit job to me.
Thank you for the polite response. Even though it is fake I still think its a hilarious work of fiction.