I see both sides of the Confederate flag argument. And your argument certainly has merit.
Including the flag as, say, a symbol of state rights against federal authority, requires a lot of explanation and disclaimer that you don't support white supremacy.
And perhaps one's anti-federalist or state rights cause is better represented with Tea Party arguments or the American Revolution's "don't tread on me" flag than with a Confederate flag. (Although the Left constantly slanders the Tea Party movement as racist with manufactured arguments as well, regardless of the absence of racism there.)

I see the inclusion of the Confederate flag as saying that regardless of slavery or white-supremacy of the Confederacy, all those who fought in the Confederacy were not white supremacists, and many of them were honorable men, who fought the war for honorable reasons other than white supremacy and advocacy of slavery.

As I could get into in a lengthier post, slave owners existed in the North as well, though in lesser numbers. And Abraham Lincoln's 1863 Emancipation Proclamation only freed the slaves of Southern slave owners, not of the Northern slave owners who were Lincoln's political supporters.