I do think that words matter, and that it's important to be polite to people, but I don't like the tendency to strike offensive words out of our vocabularies entirely. Just because it's not nice (let's say) to call someone a slut, does that mean we should stop talking about sluts at all, even when what we wish to do is defend sluttishness (or at least defend the right to sluttishness)?I tend to agree that meddling in people's usage is silly, but I'm not sure that I buy the argument that taking a word out of direct circulation will crystalize its meaning any more than politicizing or contextualizing it will. What does it even mean to use a word "with caution"? It sounds so clinical. Is the idea that you can't use the word in its current, politically charged sense anymore? Are you restricted to talking about the word? Or are you supposed to come up with novel uses? I'm not sure how you would execute any of these strategies, much less what their effects would be. But somehow it seems just as meddlesome...
As a quick perusal of the OED will show, word usage changes a whole lot over time. Archaic terms can be co-opted for ironic or affectionate use, others fall by the wayside, or acquire intriguing poetic and dual meanings. Striking a word from even abstract polite discourse is likely to crystallize the word's meaning as it is. Letting people keep using it, albeit with caution, is likely to let the word keep changing and growing. I think the latter is a good thing.
People can be pretty creative, even with words in a social/political shadow. The words nigger and cunt spring to mind here — both can be incredibly offensive, and yet they've been ingeniously co-opted/reclaimed by some in the black and feminist communities. The power of these words in their new contexts is directly related to the fact of their recent social/political history.
I'm not sure slut could be analogous. But I have to admit that I've been slightly uncomfortable using the word lately, for precisely the reasons that Matt mentioned. This discomfort (if others share it, enforced a la "with caution" or not) might change the meaning of the word over time, but I'm not sure this would be a bad thing. If the word gets politicized, it ends up with a more specific meaning, but probably also a deeper one.