Does saying these things actually work in real life?
I mean, in this scenario - if people are actively mocking someone within their earshot, would that someone turning and acknowledging they had heard really cause people to suddenly realize the error of their ways and become ashamed?
They know you can hear - asking them why they are being rude is more likely to escalate the mocking in my experience.
I think it depends on the person. If someone is mocking another person just to be a cruel bully and hurt them, sometimes acting like it doesn't hurt at all is the best way to deal with it--carry on and laugh like you want, don't give them the satisfaction of seeing that they can affect you.
But, I think the vast majority of people, especially when they don't know the other person well, are just thoughtless. They don't realize that they're being hurtful, or how
hurtful they're being. And as I said before, I think we're often encouraged to smooth things over and not let the other person feel uncomfortable, even if they deserve to, or to suck up our own discomfort to avoid giving the rest of the group an awkward moment. Sometimes, being called out on their poor behavior is the only way people will realize they are
behaving poorly. I think a lot of them think they're going to get away with it, because they always have, and when someone doesn't let them, I think they often are
ashamed--not necessarily a life-changing moment, but at least maybe they'll hold their tongue in the future.
I do agree with your last line--saying something direct like, "You're being rude when you do that," is too confrontational for me personally. I would be more likely to look startled and let awkward silence descend on the conversation, with everyone knowing it was the insulter who killed it. Maybe that's a bit subtle, I don't know.