The thing about Michael's racism is that it arose out of an attempt to show people how non-racist he is. That's what made it lovable. He was always well meaning and his goal was always just to be liked, but he was missing all the cultural meta-information we adjust ourselves by.
Oscar was one of the most identifiable because he was the head of the 'Coalition of reason'. He was the voice of the audience, pointing out 'That is stupid', which is why he's the only character we would hang out with in real life.