I agree. I recognise it's a really tough line to walk, because when you look to somewhere like America with the freedom of speech enshrined in the constitution, it gets used as justification for all manner of vileness and gets twisted and abused horrifically (by people in positions of power). At the same time, the direction we seem to be moving in at the moment could equally be used by those in positions of power to ensure they control 'the message' (even more than already) and has very dangerous implications.
I don't necessarily agree with legislation being the answer to people being cunts, and I also don't necessarily agree with the vilest of individuals and groups being able to hide behind free speech laws in order to discriminate/cause harm. Finding a balance, and how to address that as a society (and not only through the law), is a herculean task, but it's one that I don't think simply saying "free speech is sacrosanct" goes far enough in helping solve. I certainly do not have the answer, and wouldn't know where to begin.
What it's clear we do need, however, is a society and system that is able to organise itself around the idea of context, because right now the way we legislate tends to paint with a broad brush, and while the details of cases are meant to be dealt with individually in the courts, the way we legislate still means that broad brush approach is applied anyway. Often times, though, the idea of context is lost not only in terms of how the state deals with this sort of thing, but also in how we debate it as well.