That has been a decades long question
He was frequently equated with Johnny Rebel, whose whole schtick was racism and his music frequently ended up listed as DAC in the digital age
By all accounts at this time, they were separate and DAC was fairly angry about the whole thing
He did have a pretty raunchy "underground" recording that he passes as satire - basically taking contemporary (at the time) country style and using that approach to record wildly offensive and inappropriate songs - including one with a pretty notable slur
This is a big reason why his work and my Johnny Rebel got crossed in the first place
He was also known to be a BS artist, showman, drunk, a bit of a jerk, etc
Born in the late 30s, spending time in reform school, some time in prison, a members of the Outlaws MC and then moving south to Nashville (not that the Akron area was without racism.....) and embracing "rebel" imagery and a good ol boy/redneck persona - I'm sure there was likely something there
He also has vocally denounced racism, has a black drummer for years when it would have been easier not to, he also loved blues and black music and spoke of the players fondly
His first album was very blues influenced
His second, Requiem for a Harlequin, is a fever dream - but very strongly calls for freedom for blacks, is anti-homophobic and kind of politically progressive - especially with the time and place - this also didn't come from "nowhere". He wasn't famous or a country star, he wasn't trying to image clean or anything like that and it sure wasn't a path to paydays
Purely IMO he reads to me like a guy from older generations that may not have anything against gays and no held malice .... But when frustrated and drunk may refer to a straight guy as that particular gay slur and not quite connect the dots, with enough of an obstinate streak where he wouldn't care to think about it anyone and curse out anyone bringing it to his attention