I've heard use, instead of the racist verse - "...an Arkansas farmer with his seaboots on." It gets the point across the he's "never seen the likes..." I wouldn't call it PC to not want to sing the word "nigger" given its almost universal recognition as a racist term, one that carries more weight than other pejorative terms found in chanterys such as "Frenchyman,"and given that any particular chanteyman would use various verses. I would call PC the misguided effort to ban "Drunken Sailor" from a school performance, or banning whaling songs.

Chanteyranger