Hermione if you were with Snape when he was in school, and he lashed out you instead of Lily. Would you ended your friendship like Lily did?
I would have been deeply hurt–and expected a sincere apology, no less–but I would most certainly have taken the unfortunate scenario Severus was under into consideration, especially if it was a term he never called me or ever would have used prior to that incident.
It was four against one and a publicly humiliating attack. I wouldn’t have expected Severus not to, perhaps, lash out in a moment of desperation, pain, and mortification.
Furthermore, I wouldn’t have smiled at seeing a friend of mine being ridiculed like that…