I see what you mean. If I am to summarize your points, there are two types of racial insulting languages. The one you attribute to lack of education in rural and ignorance such as Chinese terms of "foreign devil". Another one is used by people who are well aware of its offensiveness such as the N word in US and "black devil" in Chinese.
For the first type, you are right and I agree with you. But the second type can not be eradicated by education and can only be dealt by severe punishment. My post was about the second type. And I made that post because so far I haven't seen or heard which word was used in the incident with my eyes and ears, so I assumed the second type.