I have a friend who is so worried about offending anyone, that he will refer to "dark skinned" people rather than use the word "black". And then there was that MP who was forced to apologise for using the term "coloured people", while the phrase "people of colour" is quite acceptable.
I do think though, that the N word is the most offensive of racist terms. I am biased (married to a black lady) but when I see it used, it is a way of putting people down. Black people have been second class citizens for most of our recent history, and some would say that they face institutional racism even now.
I don't think it helps, though, to "claim" the word, as it just emphasises the "difference", and widens the divide.