I'd been tangentially following this for a while, read GRRM's piece before it was posted here. Whether Sad Puppies / Rabid Puppies have a point I'll leave to others to work out. From GRRM's analysis, it appears not.
Whether they're justified in putting forward groups of candidates... well, yeah. Anyone is free to conduct advocacy work, whether or not we agree with it, on what work deserves recognition and what does not. We all have different tastes, whether politically-motivated or not, and are free to act on them. If the people who are so vociferously against SP and RP don't like those slates, they are free to (1) advocate for a rule change, (2) nominate their own slates, or (3) both. Or they can ***** online and trash their opponents reputations (not that ****heads like Vox Day haven't done all the damage they can do to themselves). There's a far bit of hashtag activism in this whole thing which isn't accomplishing much at all... much like certain other online movements/counter-movements whose names shall not be uttered.
On the notion that we should judge a work independent of its author, I actually agree. There are a lot of ****heads that write really compelling work; there are also a lot of really awful works written by some otherwise great people. Awards should be for merit. On the other hand, I fully support activism and boycotts of people who are REALLY ****ty, their word notwithstanding. For example, Orson Scott Card, despite having written some things I've found interesting, will never see so much as a cent from me because of his political views and who he uses his money to support. Does that mean his work doesn't deserve an award? Not necessarily - but I wouldn't have a problem with people promoting another on-par-for-quality work over his on an award slate.
I grow increasingly wary of online campaigns against the injustice-du-jour because I'm not entirely convinced that there is truly a right or a wrong side to many of them, just slightly different perspectives being blown way out of proportion in social media. And as far as the Hugo's go, there seems a relatively straightforward fix that either hasn't occurred to the people opposing SP/RP, or simply hasn't been acted on, to which I say: stop hashtagging and do something about it already. All awards ceremonies are political *gasp*. If you want your politics to win, start doing something about it. Irate tweets, blogs, and Facebook posts without a course of action don't count.
But Vox Day is a straight-up bigoted asshole, lest there be any confusion on that point.