Speedo bandito has worked well many times on a crowded day as an alternative to hostility. Both are effective, yet only one is amusing to bystanders and you cannot be prosecuted for making other surfers "uncomfortable" with your attire.
There might be some sort of law that you can't put your butt in someone's face. I know one thing - if some guy tried to put his butt in my face whether in a speedo or in boardshorts (which is the way a surfer should show up at the beach since surfers look cooler in boardshorts), it would be the last time he did it. I don't care who it is - you're not putting your butt in my face without getting your ass beat. There's no law that protects the man who puts his dirty ass in your face (I could just say I'm protecting myself from disease and sexual harassment). All I would say is be careful and don't put your butt in someone's face - it's an act of aggression that has health risks not to mention psychological damage - and it COULD be construed as an assault. Someone's butt is really ugly, particularly in a speedo. If you put your butt in someone's face, you DO run the risk of prosecution.