Sir – Respectable or Demeaning?

Well the other night I was having a discussion over the dinner table with my brother which soon turned out to a debate on the usage of the term ‘sir’. Well the very term in itself points the Dictionary as:

Sir is an honorific used as a title (see Knight) and in several other modern contexts. It was once used (without the person's name) as a courtesy title among equals, but in common usage it is now usually reserved for one of superior rank or status, such as an educator or commanding officer, or in age (especially by a minor); as a form of address from a merchant to a customer; in formal correspondence (Dear Sir, Right Reverend Sir); or to a stranger (Sir, you've dropped your hat).The equivalent for a woman when used as a term of address is "madam" or "ma'am".

What we were discussing was whether the term sir is still used to address a stranger or has it come to a stage where, when you use the term it actually demotes your social standing in the conversation.
It is worth a thought cause when we start to ape the west in several customs and manners, each good in its own way to the betterment of globalisation. But is it applicable in our society namely the south where the surname is usually the fathers name and calling someone by their surname will only get you a raised eyebrow or sometimes a curt reply, “I think he is sitting at home, my name is XYZ”. This would only bring down any hope of actually being in friendly terms with the other person.
Taking the situation to the hospitality industry it ought to be even more complicated don’t you think so?
The varied spectrum of people from all walks of life. People who have been brought up with a silver spoon, opportunists, freeloaders and officials. Each with their own thought and ideas… to too varied to actually satisfy. Now here is it appropriate to use the term sir? How would you actually justify the use of the term sir in addressing a person or individual. Each person or organisation has their own justification of the term but reaching an actual consensus on the use-age is never actually agreed upon.