TH, another example:
1. X is a neo-nazi who believes that all races other than caucasian are inferior to white people. He owns a grocery store, and a black man comes in wanting to buy something from him: "Get out of my store, [n-word], and go back to where you came from!"
2. I am driving through a parking lot and this black lady (as I recall it) is taking her good ole' time crossing the cross-walk (as black people tend to do...they tend not to walk very fast...especially when they have the opportunity to get in the way). I don't exactly remember the context, but my sister and maybe one or two other people are in the car, who (at least at the time) didn't use the n-word. I look straight at the woman (I'm in my car, mind you, with the windows rolled up...this was for the "benefit" of those in the car with me) and find myself saying, with a giant grin on my face, (again, I don't remember the context; this may or may not have been in the context of a sentence) "[n-word]!" It just so happened that, at that very moment, she happened to look straight at me, and I'm like: "Crap! She read my lips, didn't she...?"
Completely different cases.