Even if Derek never became a racist

Yes but I feel as though him being a skinhead (and probably him being known as a racist and for coming from a family where his skinhead brother literally killed a black guy) prepetuated or maybe even created the anger that the black kid had towards him. If he was some ordinary white kid with long hair, normal clothes and from a normal family, maybe he never would have gotten shot. I'm assuming the black kid took it as a racial issue, and previously already a lot of hate towards him anyway..since he was.. a racist skinhead.

Not true. There was the conversation in the park where the black kid was talking about Danny (“this the guy you were telling me about”). They likely knew that Danny was a skinhead affiliated with a racist group; they probably knew that his brother Derek did time for killing 2 black men (they were talking at the court where Derek used to play).

So it was more than just the incident in the bathroom where Danny blew smoke in their faces.

The guy got smoke blown in his face just because he got in Danny's face. Maybe if he got the hell out of people's way, that wouldn't have happened. Danny wasn't looking for trouble in that scene and seemed to be minding his own business. The others were there to harass and bully a kid because they thought he told the teacher one of them was cheating.