I dont want to be rude and I'm sorry for what happend to you - thats really not approproate behaviour, but I have to say that you do sound a bit "petty" to me here. You want him punished to teach him a lesson, not because he was/is actually causing you harm. I would honestly advice you to not let those situations get to you to much - jerks will be jerks and you will encounter them throughout your time in the game.

I actually dont believe that someone needs to be banned for several days over some name calling alone - the report-function is still important though, to deal with actually more severe incidents but also to report players for such behaviour that you described. If enough reports of that pile up in a short amount of time, they might issue a ban or take other appropriate steps.
Personally I dont see how your situation would warrant a ban though - do you run to the police irl each time someone calls you a name and demands that they get locked up to learn their lesson?

You also have no knowlegde of what SE has or has not been doing over this situation, because they dont disclose that (for obvious reasons) - him not being banned for a week, doesnt mean that they didnt investigate and took the steps they deemed appropriare for his behaviour.

While everyone might experience those situations differently, I could see why they dont issue several day bans or severe punishment over a one-time name calling incident. Its understandable that it hurt your enjoyment of the game, but a ban should (and most likely is) there last resort of punishment-options, so they need to "reserve" that for, forgive me for being so blunt, actually severe incidents or repeated offenders (so the report-function would serve to identfy those).

Again... sorry about what happend to you, but my best advice would be to blacklist those people, to NOT let it hurt your enjoyment of the game and to continue reporting, but without the expectation that SE will swing the ban-hammer on every incident you report immidiatly.
If you ever need to vent, I'd recommend taking a peak into the "Share your DF-story"-thread!