The fact that he refused to see this as a negative stereotype even though it was one of the main ones used against Jews by the Nazis means he's purposely turning a blind eye.

This story is also a prime example of how the dominance hierarchy works. Those who have historically been near the bottom of the pyramid don't see anything wrong with trying to get a leg up by trying to put some other group on that lower rung. A friend who was in Vietnam said that Black soldiers were some of the most racist towards the locals (in what I see as a similar dynamic.)

At least you tried with Benny the Butcher. Who knows, maybe you made more of a dent than you think? It's not like he was going to come right out and admit he was wrong to you since aggressive domination is such a key element of hip-hop culture.