The main advantage to the "I'm sure you didn't really mean" tactic, in its proper season, is that it's a sort of psychological sneak attack. First you provide direct, blunt feedback that what they've done is socially unacceptable. Then you simultaneously mark yourself in Friendly colors and exit the field, leaving all their status-quo-affirming psychological defenses with no target to entrench against.

It's a tried and true method for those with small but positive authority (say, those who are officially peers but have more seniority in a social circle you're new to) to inculcate group values into newbies. ("Milk and lemon? Tee-hee, surely you're joking Mr. Feynman!")