I think that, regardless of the position of their argument, people are still getting too hung up on the word "fairy" and the idea of magic.
Personally, I would have spelt it "faerie", to start with. But secondly, they're mystical creatures, regardless of their abilities. The idea of the Fairy-type is that of a pure, mystical force. Not only would this attest to its strength against Dragons, put its (I believe it was hinted at before) weakness to Poison, which represents corruption of that purity.
In the end, fairies are creatures with extraordinary powers, coming in various forms with differing abilities between them. Just like Pokémon... right?