When I was about ten years-old, I was playing on the side street next to my childhood home with my brother. We weren't the best of friends at that point in our lives given that we were four years apart and going through our own growing pains. He was consistently hellbent on annoying me and I was consistently hellbent on getting him in trouble. It was an early Spring day, and my mom was cleaning her bathroom with the windows open, both to diffuse the fumes as well as keep an ear out on us. My brother did something to annoy me and as I rolled away from him on my pink scooter, I called him an asshole. My mom heard me, of course, and marched downstairs. She dragged me inside, up to her bathroom and proceeded to wash my mouth out with Dove soap (1/4 moisturizing cream is never delicious). My intent was obviously malicious in that moment. I was mad, I had some concept of what the word meant, and I used it to berate my brother for some stupid move on his part. I was punished.
Alternatively, when it came time for yearbooks to be passed around and signed in 7th grade, John Abruzzino decided to be himself when writing in mine. This pimply, awkward and overwhelmingly intelligent kid who endeared himself to no one wrote in my yearbook, "to all the loquacious from all of the loquacious ones". Frustrated by the fact that I had no idea what "loquacious" meant, I snatched my yearbook away from him and said, very denotatively, "John you are so QUEER." Mrs. McCunney called me immediately into the hallway and asked me to repeat what happened. I told her that I was mad because I had no idea what he meant, and so I called him unusual. She said, "no, you said queer, and that's why I called you out here." I received my first big lesson then in connotation versus denotation and the difference between interpretation and intent (she was an incredibly liberal and accepting woman; this was not a lesson in conservative propriety). Many years later I saw Mrs. McCunney at a craft show and told her I was, interestingly enough, queer but that her lesson resonated with me. She hugged me and smiled. She was a great woman.
Because of both experiences, I learned a very hard lesson: words do in fact hurt as much as sticks and stones, and that erring on the side of caution is always the best choice, specifically in the company of strangers.
Recently I had an opportunity to act as an ally for transfolk who have been hurt or maligned by the word "tranny". Christian Siriano, the out and proud designer from Project Runway's fourth season, kind of propelled the word tranny into collective consciousness. What had previously been something relegated to dark clubs and LGBTQ events seemed to take center stage, with people (primarily women) using it in reference to fashion and clothing choices. Many LGBTQ identified people accepted this without reservation, and I hypothesize that much of the acceptance has less to do with a desire to break down walls of oppression and more with their/our fervent desire to belong. If you look at how other marginalized groups have been forced by dominant classes to just accept a reintegration of a pejorative, I don't see how you can disagree with me. As with everything, there always seem to be exceptions to the rule. The way I see it, though, there are very few acceptable exceptions.
PortlyDyke, a writer for Shakesville, recently created a series of posts designed to bring this concept to a finer point. Entitled Watch Your Mouth, the posts do a very thorough job of dispelling the myth that "just because" there are people who have given you permission to use a word previously or presently used violently, oppressively or pejoratively, that it does not make it acceptable. Additionally, because language is so diverse, overloaded with synonyms and malleable, there is no justification for using a word we know has been used to hurt/wound/maim in the past. Furthermore, intent requires context and familiarity with and between the persons involved. It is not an excuse. I highly suggest you read and absorb these posts to further clarify my point:
One Grand Home for an expanded discussion about Knitta Please, for example). Talking heads argue on national television about the right of dominant social and economic groups to use slurs casually because the groups targeted with those words are now using them "positively" or "conversationally". I wish the effort we put forth to have our right to speak freely could be redirected in an effort to combat prejudice and inequality. As far as the word tranny is concerned, it is not a word for cisgendered people to use (with positive or negative intent). Period.
ETA: This is a fantastic new post from Questioning Transphobia about intent. Read it!