Honestly, most race/culture terms seem weird to me: Caucasian (random geographical area), white (tan-pink), black (brown), African-American (regardless of being from Africa, or being American in some cases), native American (as opposed to immigrants?), Asian (sure, the biggest continent can be lumped together)... I assume it's from trying to describe a very complicated combination of factors in a single term, but the results do not make my programmer's brain happy.

It's not because you've got a programmer brain. It's because these categories are truly stupid but academics and other people in a position to challenge then will not out of fear of ostracization.

A truly non-racist policy would be to remove these ridiculous categories from any official documentation. European countries do not need to rely on these stupid labels to implement social welfare.