People who use this phrase always seem to use it to defend their censure of people who refuse to act or believe the same way that they do. Evangelicals who fought tooth and nail against gay marriage are a recent example that springs to mind. It seems a terribly perverse defense to use the word love when they clearly do not love the people they are referring to. There are no intense feelings of deep affection, only lip service to a dogmatic ideal they do not truly feel.
It is a particularly loathsome statement because its sole purpose is to throw an acceptable looking disguise in front of their true meaning: My dogmatic viewpoint is more important to me than your life and choices.
Someone who loves sinners does not work to outcast them from society. They do not publicly berate their choices, fight against equality for their ‘kind’, damn them in their minds and then backhandely pretend to care about them.
Vocal abusers of this phrase so frequently get caught indulging their own ‘sin’ that it appears quite a few of them don’t actually hate the sin either. I imagine such people are just over-compensating for their self-loathing when they attack others and try to bully and shame them away from the lifestyle they envy.
Certainly some who use the phrase mean nothing at all by it except to attempt to fit in with their peer group. These are almost dismissable except that even the least empathetic among us should be able to see that such words are hurtful to the ‘sinners’ involved. If this applies to you, this is your notice to desist or be thought of as a cowardly douche by some random blogger on the internet.
The rest of them should get no such leniency. Hateful words and deeds should always be called out and rejected, particularly when they align with your belief system. If such a thing as the dark side of the force exists, chosing dogma over kindness is its first shadow.