It's a very real word sure, but the manner in which the community overuses said term and how inappropriately said term is used then yes, yes it becomes pretty meaningless. It's slowly on the rise but it is not anywhere near as prevalent as people on this forum would like to try and overstate. All it results in is gross generalisations applied to the community as a whole. Ironically the embodiment of this very thread. So in the circumstance of this game you'll have a difficult time convincing otherwise. The end result regardless of how you look at it is just something that stifles any form of discussion.
Replying to your edit: I think given the length of your stay you'll probably understand that the end-result is just a taxing back and fourth of playing the blame game, thus a dumpster fire. This thread providing any form of meaningful discourse is just moot, again because this is just an overstated hyperbole. The number of people actually being toxic positivists is much lower than people are led to believe. For this reason and this reason alone meaningful discourse won't really happen, won't change anything. It'll either be an echo-chamber or people biting back at the generalisations. No different from how people are oh-so-eager to label another individual as a white-knight or fanboy for simply disagreeing with a criticism. Equally no different from the folk that seem to think people on the game are immune to criticisms, as if criticism in the first place is a homogenous perspective. All of these examples only serve to highlight the blatant inappropriate-ness of some terms and phrases used.
Equally, there's a certain amount of irony in attacking the developers (Which was very prevalent during server issues), and then expecting to think you can try and deflect any criticism upon yourself with "Lul, more toxic positivity and white knights". As far as I'm concerned, this is just a reap what you sow situation.