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It's not even RIGHT AT ground zero. It's like a block / two blocks away.
They have every right to be there. This is America.

Okay, here's the thing about this essay: the wording of the question is unclear as to whether the essay is supposed to be analytical or persuasive. "What issues" implies that you should be presenting a rounded account of the issues surrounding the mosque debate, while "should" implies a level of personal opinion involved. Did your teacher elaborate on that?
I'm going to assume that it's supposed to be analytical, not voicey or full of pathos, but more ethos/logos-centered supporting a thesis. Your thesis being what should be considered. In this case, I agree with Spock - any regular building regulations should be the only things considered. Though you may want to (should) also talk about how many people see the issue as emotional as well, which you'd have to refute in a very fact-based manner assuming that you agree with the legal issues only thesis and it is analytical.
Also, it's worth it to note that the "mosque" (it's actually an Islamic Community Center that happens to have a prayer space in it) is actually blocks away from Ground Zero.