Ending Racism Versus Not Being A Racist
In one sense this is a purely semantic debate -- after all, whether you call something "racism" or not doesn't change how morally acceptable it is. But in another sense it's a very important debate, because it's symptomatic of the way different people approach racial issues. The problem with people who cling to the dictionary definition is that they substitute semantics for ethics.
The (usually white) dictionary-ist reasons: "what's wrong in race relations is 'racism' (or 'being a racist'). Therefore we have to establish what 'racism' means. And, as any good linguistic descriptivist will tell you, 'racism' means whatever most people use it to mean -- a fact which can be determined by looking it up in a dictionary." This is, in effect, an appeal to cultural relativism in the defense of the status quo -- "most speakers of my language would/would not apply a condemnatory term to the conduct in question, therefore it's wrong/right."
The sociologist, on the other hand, begins with ethical premises: "what's wrong in race relations is when people get unfair advantages or disadvantages on the basis of their race. The creation or maintenance of such advantages or disadvantages requires both prejudice and power, since a powerless person can't have an impact on another's life chances, no matter how virulent their hatred."
In theory, the sociologist could leave the definitions as they are, and just promote the idea that some forms of racism/prejudice are serious ethical violations while others are trivial, based on whether they're backed by power (a la the "marriage in all but name, so the fundies will shut up about us redefining the word" theory of civil unions). But the fact that there are so many dictionary-ists in the world makes this an impractical strategy. We're therefore forced to try to change people's behavior by changing our usage of the relevant condemnatory words.
Another way of framing the difference between the two definitions is suggested in Ampersand's recent post. He points out that people of color tend to think about racism in terms of its effects, whereas white people tend to think about it in terms of the intentions of the perpetrator. In other words, people of color are consequentialists and white people are naive Kantians. People of color want to end the system of race-based advantages and disadvantages, whereas white people want to ensure that they're well-meaning. It's therefore in people of color's interest to recognize forms of real racial advantage/disadvantage so that they can be corrected, whereas it's in white people's interest to ignore them so that they don't trouble their conscience. And it's therefore also in white people's interest to push the dictionary definition of racism, since it's entirely about psychological states. That definition focuses on the cleanliness of their own hands (and the potential dirtiness of others') rather than on the actual effects of whatever conduct is at issue.