So what about when the word "gay" was assigned a different meaning and went from not only meaning happy and carefree but meaning homosexual too?
Language is constantly changing and evolving. It happens all the time.
Actually, I think that most kids don't see the word "gay", as they liberally use it to mean "lame", as a term of homophobic abuse. In my experience with the teenagers in my own family and the many I come into contact with as a result of knowing their friends etc, they are all extremely unconcerned about the fact that people around them may be openly gay, bisexual or whatever. They all say they know openly gay people at school and it seems to be no issue at all. They learn about it in PSHE and there are posters all over their school saying "Some People are Gay, Get over it", there are also loads of people in the media, on TV and on the music scene who are openly gay and have very positive images and are very positively received.
I think that most teenagers these days have been born into and grown up in an age where it's no big deal whatsoever to be gay and whilst those who have to come to terms with "coming out" as gay to their families etc will no doubt go through their own personal struggles, I certainly don't think that your average teenager these days would turn a hair at someone being openly gay.
Of course there will always be examples of homophobic bullying that buck this trend but on the whole I refuse to believe that if you did a straw poll at an average secondary school many teenagers would turn a hair. In fact, in my experience many kids I know think it's quite cool to be gay and to have gay friends - particularly teenage girls.