The episode The Siege was based of a real incident involving the media.
From Wikipedia (I love wiki):
this episode is a thinly veiled reference to a highly controversial real-life incident, in which Mike Willesee interviewed gunmen and hostages on-air. [1]
In general, yes. Frontline is a parody of Current Affairs programs.
'The Siege' is based on a number of real-life incidents, including the famous Mike Willesee interview as "The Eagle" said. It's an incredibly good episode.