Is CGM an offensive term?

I've had this question on my mind since attending the ad:tech conference in Chicago and chatting over lunch (which provided food left a little to be desired) with Henry Copeland and Steve Hall. Steve recently posted about an email he received that claimed there was this 'hip new cool consumer generated media site'. The email went so far as to say "It's a great example of the power of users to support a brand without any resources and make creative content." Big surprise, Whois shows that it was created by an agency.

A commenter to the post: "This is overtly corporate and to pass it off as user generated content is insulting to our intelligence. I'm sick of brands being dishonest in feeble attempts to create the almighty "buzz"".

I'll save my lectures on 'how not to suck at viral marketing' and 'how to say no to viral marketers' (take note, Steve.) for another time. However, I do want to know, with all the talk of Consumer Generated Media in advertising agencies and conferences and client pitches, is or has the term become offensive? Henry Copeland had gone on a rant over lunch about how the term 'consumer-generated' holds no meaning and that we should stop using it altogether. He essentially said it was stupid of us (as advertisers or clients) to assume that people who create their own content are actively consuming the brand or should be branded as consumers.

In numerous pitches across the states, agencies/clients are recommending creating their own channel to 'allow consumers to be able to express themselves while interacting with the brand at the same time.' What they're trying to do is to gain control by providing a safe haven of a channel. "Consumer" Generated Media is not pre-determining content limits or channels! It should be no different than a solid Word-Of-Mouth strategy - organic and limitless. More times than not, especially over the years, "viral" and CGM-brand-sites are reactions to what's already going on, rather than an attempt at creating the reaction. So, is Consumer Generated Media a term that defines limited, pre-determined creation that coincides with an opaque brand?