I just found someone who perfectly explicated the attitude that Sad Puppies is reacting to. This is a quote from Moshe Feder, an editor at Tor, on his Facebook page:
[Larry Correia] continues to be deeply confused, like many SF&F consumers of the post-ghetto era, about the definition of "fan" [admittedly, a confusingly generic word; we probably should have gone with STFnist] and "fandom."
Until he can understand that he wasn't lied to when he was told that the Hugos represent all fandom's imprimatur, because the worldcon community and historical fandom are synonymous, he's never going to get why he's wrong.
As long as he insists on acting like anyone who buys an SF book, or a comic, or who watches SF movies or TV, is a member of fandom, I'm never going to be able to take him seriously.
As I've said before, you can read all the native literature you want, but until you learn the language and come live on the reservation, you'll never be a member of the tribe, especially if you refuse to respect the fact that they were here first."
(Comment left about 7pm on 4/9 on his post made 4/8 at 6:27pm)
So here I am. I've been attending SF cons since 1985. That includes cons from New York to Los Angeles and Spokane to Atlanta. I've written stories, fanfic and original. I've cosplayed. I've gamed. I've even published some RPG articles. I've written book reviews. I've been a con panelist explaining how real world rockets work to the fans.
But according to this guy I'm not a member of "the tribe." I'm not a Worldcon regular so my vote isn't welcome on the Hugos. Well, that's not how the Hugos were described to me when people were excited to have Larry Niven at my first con (Icon on Long Island). It's not how I've seen them discussed since. It's not how they were defended against Correia's complaints when Sad Puppies first appeared.
In previous years whenever anyone complained about the Hugos the response was "So get a membership and vote yourself." Well, I have. I'm a supporting member. I made nominations (a fifth of which made it onto the ballot). I'm going to read as many stories as I can. And then I'm going to vote.
Because I believe the Hugos are for all science fiction fans, not just the ones attending a single con.