Don't worry about it. Some people are just rude. Blue's are in the genes. Are they "acceptable" per breed standard? No. But that doesn't make your dog less.
If they don't know that blue's are in the genes then I would wonder what they really know about German Shepherds.
AKC does not follow FCI standards. That is correct. Any dogs that have a pedigree can be registered and bred regardless of quality. It's why there are American Show Line, German Show Line, Working Line. I can't speak for the other kennel clubs. However, right now it's the best system we have for purebred dogs.
Next time, we'll let Germany keep France.