Earlier quoted context omitted.
It may have been coined that way, but Mormons quickly adopted it as well as a favorite term and used it that way coming up on 200 years. The church used the word extensively in marketing campaigns for decades, between mormonads and I'm a Mormon, etc. Under Hinckley who was media savvy, it was used a lot. Nelson (current head of the church) just doesn't like the word and wants to change it. Confusion, inconvenience, a…
I find your insistence that they can't be offended by a word with an objectively offensive historical origin fascinating. Do you deny that sometimes opinions on words and language can change over time?
More reasonably, I think they are not offended. Rather they are simply trying to use the full name of the church rather than any sort of shortenings. Sure, if somebody was being a jerk and using the word Mormon to be a jerk, then that could be offensive. However, that's a much different thing than being offended by the word itself used in a friendly context.