I worked several years with a legally immigrated guy from Japan. He did not consider "Jap" racist but didn't care for "Nip". He often used the word Jap himself as an adjective talking about cars or food.
He was however a good natured guy that a got a good laugh when he would get gifts such as Godzilla videos or 8X10 pictures of McArthur on Pearl Harbor Day. Him and I got along fairly well even after him and his wife participated in the Million Mom March. He tried just one time to convert me to his side then never brought it up again.