My grandmother still called them Frankfurters. And there is a terrible joke about two ladies coming to the US from another country, to visit. They had heard that we eat "hot dogs" and decided that they had to try the local food, even if it sounded terrible. So they order the hot dogs from a pushcart vendor; one of them looks in the bun, under the 'kraut and relish, and blanches. Then she asks her companion something like, "And what part of the dog did they give you <name>?"
Ok, no more off-color humor.
I've been thinking about this thread though, and actually do understand why the fellow was offended - in many/most circles, "wop" is a perjorative term. Even if the proprietors are Italian, it still could irritate someone to read the word on the menu.
Oh - another thing I heard but never was able to verify was that the term came from Ellis Island, where they would give people a paper that had WOP written on it - acronym for With Out Papers (this may be BS - without is one word, not two). Still...