I appreciate your post!
I grew up in 1980s New England. I'm plenty familiar with the word and of course I used it growing up. I had an aunt with Down syndrome, one cousin with cerebral palsy, another with Rett syndrome. All awesome humans. Once I was an adult, it was just like...why the fuck would I use that word? These are people I love dearly.
Sure, maybe if we're ranking insensitive slurs, it isn't top of the list. I guess? And it's an easy one to hold on to because it's a group that isn't generally in a position to speak up for themselves. It doesn't mean we shouldn't try to do better.