I would like there to be a toggle for this, as I do not like users being unhidden when they are frozen. If they're hidden, it's likely for a reason and freezing isn't always a punishment.
Specifically we use freeze in tunnels of rainbow colours to create an elliptical effect, in which the hidden users who are frozen do not appreciate being thrown out of their hide. I know someone else had one other complaint about the feature, but for a different reason.