Yes, that's what it means.
No, I haven't, and I don't know anyone in real life who has been physically bashed because of their sexuality.
Freaky, as against guns as I am, I can't help but partly agree that it would help the gay community to be able to pull something out of your jacket and say "back the hell off or I will kill you." But, satisfying as that image is in my head, I know that it would only escalate the contempt some feel for the gay community and make the overall problem worse.
A person isn't worried about contempt when they're at risk of becoming the next Matthew Sheppard. If someone was to get physically bashed, I'd fully support their right to shoot their assailant(s). Hell, I'd shoot them if I were to see that happen. I'll be legally carrying one of these around once I turn 21, so they better not let me catch them.