Regarding "How could this not be considered offensive," yes the term 'bitch' when referring to a woman who is not your friend is offensive, and highly so. However, between gay men it is a term of endearment. And when referring to a female friends it has become akin to 'friend,' 'amiga,' or 'compadre'. Of course it would almost never be used in a formal setting, and my experience with it is limited to the southern United States.