[needmorePaine]

You can accept it as a blessing and walk away, or an insult and make an azz out of yourself.
Oh please, it's purely passive aggressive. It's a backhanded phrase, somewhat similar to prefacing an insult by saying "I don't mean any disrespect but..." followed by disrespect.

[Ditter]

Nope, you are wrong. I have offered that phrase to people that I love and have sympathy for after they have suffered a tragedy. I have also said it as a snarky comment to someone who was behaving badly. The only difference is the look on my face.