It's essentially a shibboleth, a way to confirm that you're in the "inner circle". Tribalism is still one of the strongest force in social science it seems, even if we start with lots of identical people they'll try to differentiate and discriminate between each other.

For those who are truly into etiquette, we understand that it is a gift we give to others and hope they will choose to return in kind. It is actually extremely poor etiquette to point out the missteps of others. The superior you unfortunately had to deal with was an asshole. Being an asshole is pretty much never appropriate.

I stand to greet others because it shows them respect and maybe because I am a little old fashioned. I take off my hat in private spaces for the same reason. I also know enough etiquette to know that modern hat customs have been modified because they are more of a fashion piece now than a protective garment. Hats have different rules when their primary purpose is to be an accessory.

Do you know what I do when someone gets etiquette "wrong?" Nothing! It is rude to police others. The most someone should do is to gently steer others away from a faux pas if it would likely cause them embarrassment or future difficulty.

I think what I really want to write is that I am sorry etiquette has been used as a social bludgeon against you. Good etiquette should feel seamless and unobtrusive. Formality can be lovely, and instead it has been a bad experience for you. That sucks.

Edit to add: I am really talking about classic English/American etiquette. I am in no place to comment on things like the etiquette in many Asian nations. I know some of the customs, but little of the nuance that goes into them.