I think it is insidious for Reid to imply that America is so racist it would never have elected Obama if he spoke or looked a certain way. I am a devout conservative, and frankly, I can tell you from my perspective, I don't care if someone talks like Elmer Fudd and looks like Bella Abzug, as long as they articulate core conservative values and principles. I think a vast majority of America feels that way as well, and only a scant minority would hold Reid's racist viewpoint.
To me, it wasn't as much about usage of the word "negro" that bothered me about Reid's comments, it was the implication and insinuation, that average people routinely exhibit racist prejudice based on skin tone and dialect. Perhaps this is true in Nevada, maybe it's true among Democrats, but it is certainly NOT reflective of the views found in mainstream America.