I think sometimes overly sensitive moderation is not good.
Personally, I like Dan's "Nietzschean flamewars" phrasing, and I sort of agree that "trying to get him to conform to slave morality" was a personal swipe. But if so, only barely. This could well be an example of overly sensitive moderation.
The real problem with that thread (in my opinion) is that Rayiner's comment was allowed to stay flagged to death. One might not agree with his opinion, but it's a viewpoint worthy of reply (as you did) rather than censorship.