I agree with you if "not allowed". Personally I wouldn't particularly want to choose the single gender idea either given free choice. I just don't see what's wrong in saying go where you want, there are facilities for you to follow your religious beliefts if that is what you choose. Much like Sunday working, Christians can opt out if they choose for religious reasons, but that doesn't mean that all shops have to shut for the rest of us.
What happened in this specific case depends on if you believe Richard Dawkins, Zayd Tutton, or some other version of events.
I have absolutely no objection to Muslims wanting to segregate themselves. I would expect to see that practice in mosques, just as I would expect to take my shoes off when going into a mosque.
And if this event had been staged in a mosque, then the seating arrangements could have been determined by the mosque officials.
What is notable, however, is that it was a debate open to a wide audience that took place on UCL premises.
According to Zayd Tutton of the Islamic Education and Research Academy: "There were three sections, as agreed with UCL prior to the debate. This was agreed clearly with UCL representatives.
"Muslim women choosing to adhere to orthodox Islamic principles in sitting in their own area had their own section. As for those who wanted to sit together, male or female, they had their own section where they freely mixed and sat together from the beginning."
In other words, the University, which hasn't denied Mr Tutton's version of events, agreed to the segregation of its audience. And, as Mr Tutton doesn't say, the women were at the back.
I don't think an academic institution, particularly one that was an enabler of women when they had few opportunities for higher education, should agree to this sort of demand.