Gamesradar summed it up pretty well. They were referencing "fag" but "gay" seems to work by this logic as well. Basically, when it is not used to mock someone's flamboyance, it shows how bland one's insult generator is. When someone says, "your argument has no merrit" and you respond, "Oh yeah? Well you're gay!", that pretty much translates to, "Oh yeah? Well, I can't think of anything clever to say so I'll just call you gay."
Everyone else on this forum so far seems to have the phrase, "that's so gay" covered, so I won't bother covering that.
Everyone else on this forum so far seems to have the phrase, "that's so gay" covered, so I won't bother covering that.