Interesting comments -agree it is meant to be insulting but in 1950s and early 1960s where I lived it was certainly regarded as less rude than using the F word, actually a lot less rude. I am not sure we regarded it as aggressive - more just a reaction to something of which we disapproved.
However all that means is that social studies have to take account of the location and context when analysing these instances; sometimes there are local variations which we would not see now at all as words, phrases and gestures are all much more universal than they were when I was growing up, when quite localised variations did occur. So my recollection is correct and others' recollections are also correct but each based on their own background and cultural norms.
Personally I blame Desmond Morris!
Just also realised that Roy Clarke's own recollections and cultural influences are pertinent here - he wrote it!
On the few times that I've seen Compo use it, in the context of a comedy and the moment it was used it was funny, in the same way he jumps all over Nora Batty in an unacceptable way type funny, there's no intent to shock, but it does show that even in the most gentle of comedies there are things that we can look at and say, he wouldn't get away with that in real life. Compo does get away with lots of things, but he was the rebel of LOTSW and accepted as such.
As for Roy Clarke's own background he was writing for a national audience so must have been aware that even if historically it meant something different and more mild in Yorkshire, that's not the case in the way it was seen nationally.
I'm reminded of another Yorkshireman who got in trouble over its use. Harvey Smith.
1971: 'V-sign' costs rider victory
"Controversial horse rider Harvey Smith has been stripped of his £2,000 winnings and a major show jumping title for allegedly making a rude gesture.
Mr Smith was seen to make a two-fingered 'V-sign' in the direction of the judges after winning the British Show Jumping Derby.
The rider has protested his innocence, claiming the judges mistook his gesture.
"It was a straightforward V for victory. Churchill used it throughout the war," Smith said.
Both signs are made using an upwards motion with the first two fingers extended.
However the victory sign is made with the palm outwards and the obscene gesture with palm inwards."
He was re-instated, but later apparently admitted in interviews that he was making the obscene gesture.
http://news.bbc.co.uk/onthisday/hi/dates/stories/august/15/newsid_2534000/2534107.stm
That happened in the early 1970's, and I remember it being quite a controversy at the time and for a while at least the two finger salute was known as "doing a Harvey Smith".