My niece's nursery group were overheard by her mother recently singing "Baa-Baa rainbow sheep".
I've heard that being used here too.
The Government department I used to work in, at Christmas time you couldn't use the term 'Merry Christmas' in emails or letters, and the official Christmas card one year used a picture of some scientific close up of cells. The inside was left blank.
When I left, that year at Christmas I mailed Christmas cards to everyone I worked at and I made sure they were all very traditional religious cards. My political correct manager, received a card with the nativity scene on it.
Even at Christmas time, shops don't play carols in fear of causing offence to someone who will probably find it offensive, decorations used are of a 'Christmasy' type, like stars and bells as anything else might swing towards being traditional and offend someone. Its all outrageous.
When I was a child, and I'm only 25, I remember having a Gollywog. Does anyone remember them? Try buying one now days. I will make sure my children have the same non-political correct upbringing as I did.
Now how's this for a joke. In Victoria there is an island called 'Phillip Island' which is extremely popular for tourists, especially Japanese ones that get ferried there by the coach load.
Well one of the biggest attraction down there is the Fairy Penguins, where you go and see them of an evening come onto the beach in their hundreds which they call the 'Fairy Penguin Parade', which its nice to watch.
Political Correctness pretty much tried to ruin that too, apparently some do-gooder, thought that the term 'fairy' was insulting to gay people and tried to have it changed, well the gay community slammed them and told them they had no worry at all, and didn't have a problem with it.
Another case was in Brisbane up in Queensland, 'Queens' Square in Brisbane almost went for a name change because another do-gooder thought that it was insulting to gay people etc.
You would imagine by now that if you were gay everyone would be bending over trying not to offend you. Although they are only some of the many cases of political correctness gone made. I don't think its done any good for society.