This is a very important point, and I do not think kids should be allowed to use gay as an insult in school.
I understand the point you're trying to make, however it's going to happen again and again, as far as name calling is concerned. Being called a faggot or queer was the worst thing you could call someone while I was in school. I teach alot of high school kids and I hear it quite a bit. Someone brought up the issue of what the context is when the term is used. The problem, in my opinion lies when it is allowed to escalate from there into aggressive taunting, and physical acts of violence.

I hate the idea of thought and word police telling my kids what they can and cannot say. That's my job. Again, this is where strong parenting is key for character building and acceptable conduct.

At any rate, back to Ann Coulter. How can anyone be expected to be taken seriously when they say such ridiculous things publicly? I sincerely hope this affects her sponsorship and muzzles her actions a bit; although I seriously doubt her tone will lighten or go away anytime soon.