While Barbara is completely right, there is often a big difference between "theory" and practice." If you think about it, almost anything could be considered hazing. I know most of the fraternities on my campus use nicknames, which can have some gross meanings behind them, but the guys think it's all in fun.
I don't think you're being overly sensitive as this is your good friend, but IMO you have to ask whether he's okay with this. If it bothers him too, then you should both speak up...but if he doesn't see it that way then maybe you should leave it up to him. I'm not saying that this is what happened in your case, but most of the time, these things can be exaggerated and maybe you didn't hear the whole story.
If this really bothers you that much, then do what you have to do, but I really encourage you to talk to your friend first.
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AGD
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