Gay is just a word and with time words take on different meanings in society. People who insult others with "gay" aren't refering to their sexual orientation (most of the time) but that the person is being dumb or stupid or something to that effect. It's easy for older people to look down on this behavior, which usually occurs among younger individuals, because they don't understand why it's being used. Much like how many older people don't understand the terms associated with technology, they may not as well understand how the youth have changed the meaning behind the word gay. Eventually I'm sure that either people will stamp out using "gay" as an insult completely or change the meaning as apparently is happening today.
And now that I've just said a lot over something small in importance, I'll shut up.