Should song lyrics be judged by the same standards as poetry? Poetry can be pondered over and levels of meaning extracted - song lyrics have to be seized on as they pass by, and must usually be more direct. That's why poems seldom make good songs, and vice versa (with notable exceptions, of course)

Were the words obviously anti-semitic and clearly going to give widespread offence, then it would undoubtedly be right to alter or omit them. But that's not the case with LOTD, and even some Jews have said that they don't find it offensive. Where a meaning is ambiguous then it seems reasonable to me to accept the more obvious interpretation, especially in the context of the song as a whole and from what we know about the author.

There will always be some who will seek to find offence and will take the less obvious meaning. Some singers will choose to alter the words to avoid any possibility of giving offence, no matter how mistaken, and they're free to do so. However to me it seems unreasonable to be expected to change the words of any song simply because some might misinterpret it.