I'd say the tabloid press as a whole have to take some of the blame. It's like the Ba Ba ethnic/coloured/rainbow sheep stuff. That was clearly made up b0llocks but people/teachers/child carers have obviously read the stories and decided that they don't want to risk they're jobs so they start...
The whole "it's been hijacked by racists" thing is utter nonsence. That attitude is just a reflection of people's own insecurities. It isn't possible to hijack a flag, the only hijack is of people's minds.
I've no doubt that many people have thought "I hope nobody thinks I'm racist" when...