It's always demeaning. Calling a full-grown man of any race "boy" is belittling them. Yes, there's a special racist association, but it's been used as much on white men. The female equivalent might be "little girl."
"What do you think you're doing, little girl?"
It might have the same effect as simply "girl" if said the right way, but "girl" has been more normalized and sexualized, so it's a little different.
Anyway, the terms are belittling, and therefore demeaning, regardless of race. The point of using them is to position yourself over that person, as a parent over a child; it's shorthand for saying they are beneath you.
I think most non-Southerners' exposure to it is in media, where it's almost always racist in context. There's a surprising amount of subtly in Southern social interactions that I think it's missing from most of the US. Sure, Midwesterners are known for raising passive-aggressiveness to an art form, but you recognize it no matter where you're from.
The subtly in social interactions in the South are truly exceptional, hard to get a handle on, and unmatched anywhere else in the US - IMHO. Southerners have as many ways of being condescending as Eskimos have words for snow.
Is that phrase still acceptable, or is the Eskimo/snow comment now not PC? Is it still OK to use the term "Eskimo?" If the Eskimo thing is offensive, I sincerely apologize. An alternative would be "as North-westerners have words for rain," but I don't know if that's as widely understood an idiom.