Absolutely no excuse for a white person to ever use the n-word. I'm not a fan of blacks using the n-word either, but not being black myself (although I'd probably count under Lisa T. Jackson's definition ), I'll stay out that debate.
Sadly, I'm not surprised based on my several visits to Savannah. The entire area seems to be stuck in the Civil War era. My aunt and uncle lived in a town where the mayor flew the confederate flag. We drove through areas where, quite seriously, white people lived in gated communities while black people lived in honest-to-god shacks on the side of the road. And I thought Philadelphia (where I grew up) had racial segregation and tension!
Shame on Paula Deen. I hope she's fired, even if I think this complainant is opportunistic and probably money hungry.
ETA: I do agree with PL that I would be extremely uncomfortable in any workplace where people use derogatory language toward any group.