I think the fact that the Sammy Davis Jr. impression originated on SNL means the whole thing is forgivable, although I would say it was still misguided.

I don't think it's racist to portray yourself as someone from a different race. What about Maya Rudolph? She is mixed race (black mother & white father) but on SNL she has played characters from virtually every ethnic background imaginable. The same goes for Fred Armisen.

If Billy Crystal had done a sketch where he did a stereotypical black guy (like a Tyler Perry character) then the conversation would be different. Fact is, he was impersonating a one eyed, jewish black guy. There are no stereotypes involved.