OOPS, EDIT, Evo beat me to it!
This is a well-known story told about Frederick II of Hohenstaufen (1194-1250).
http://en.wikipedia.org/wiki/Frederick_II,_Holy_Roman_Emperor
He was called Stupor Mundi ("Wonder of the World"), and refused to accept things without reason. He employed Jews to translate scientific works from Greek and Arabic. He wrote an excellent book on falconry, and he forbade trials by ordeal. A very modern man, in many respects.
Perhaps one of his lasting achievements as a lawmaker is the ban on doctors being their own pharmacists.
He also had pretty rabid enemies, like the monk Salimbene.
He is the source for the story about the babies, here it is, from Medieval Sourcebook:
"[Salimbene] goes on to enumerate several specimens of the Emperor's "curiosities" or "excesses," though for sheer weariness he will not tell them all. Frederick cut off a notary's thumb who had spelt his name Fredericus instead of Fridericus. Like Psammetichus in Herodotus, he made linguistic experiments on the vile bodies of hapless infants, "bidding foster-mothers and nurses to suckle and bathe and wash the chidren, but in no wise to prattle or speak with them; for he would have learned whether they would speak the Hebrew language (which had been the first), or Greek, or Latin, or Arabic, or perchance the tongue of their parents of whom they had been born. But he laboured in vain, for the children could not live without clappings of the hands, and gestures, and gladness of countenance, and blandishments. "
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Salimbene ALSO tells us about Fredrick II:
" "he enclosed a living man in a cask that he might die there, wishing thereby to show that the soul perished utterly, as if he might say the word of Isaiah 'Let us eat and drink, for to-morrow we die.' For he was an Epicurean; wherefore, partly of himself and partly through his wise men, he sought out all that he could find in Holy Scripture which might make for the proof that there was no other life after death, as for instance 'Thou shalt destroy them, and not build them up': and again 'Their sepulchres shall be their houses for ever.'
Sixthly, he fed two men most excellently at dinner, one of whom he sent forthwith to sleep, and the other to hunt; and that same evening he caused them to be disembowelled in his presence, wishing to know which had digested the better: and it was judged by the physicians in favour of him who had slept. '
"Personally, I think most of these stories seem to be attempts at character assasssination, rather than having anything historically substantial to tell us about Frederick II
http://www.fordham.edu/halsall/source/salimbene1.html