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Entertainment Weekly Exclusive: The Walt Disney Co., which employs an ex-drug dealer (“Home Improvement” star Tim Allen) and hired a convicted child molester to direct its 1995 film “Powder,” apparently has decided where to draw the line

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— as former MTV personality Simon Rex, 23, learned last week.

Rex had been cast in the teen sitcom pilot “Zoe Bean,” which Disney is producing for The WB. However, when Mouse execs learned of Rex’s adult-film past (at age 19, he showed off his onanistic skills on camera), the studio pulled him from the show. The WB (and parent Time Warner) fought Disney on its decision but lost. The battle, sources say, even reached into the offices of Warner Bros. Chairman Bob Daly and Disney CEO Michael Eisner.

“They said they were not comfortable with him being in the project,” is all one Time Warner exec will say. Eager to keep Rex, The WB tried to buy the project, to no avail. The only bright side for Rex: Disney paid him for his work before releasing him, and the WB still plans to sign him to a development deal.