For the most part, I agree with everyone's stance on this subject. However, my definition of the word is slightly different from everyone that has posted so far. I agree a "noob" is someone new to the game as it derives from the word "new." But I also call people "noobs" who play like "noobs" or someone who is new to the game. "Noob" can be a noun or an adjective. I don't care what someone's level is, if he/she plays like he/she just bought the game, IMO he/she is a "noob."
Now one may say well he is level 60 (or some high level), How did he make it so far and be a noob. Well, it really isn't that hard to grind. Just takes patience, no drastic skills. When someone is really terrible at this game I call them a noob. I think it is much nicer than saying, "Man you really suck at this game."
example 1: a level 3 player who has never played EQOA in his life is a noob - the noun.
example 2: a level 54 player running across the kappa bridge with his pet out training everyone unknowingly is a noob - the adjective.
Also noob doesnt neccesarily have to be an insult. Most people use it as one but there are some "true noobs" out there. I think people take it more as insult as they gain levels but don't gain knowledge. Face it, if you're a noob, well, you're a noob. Don't get mad, just learn from it.
P.S. I'm probably still a noob. If someone was to call me one I would laugh and say ok. Wouldnt take offense. We are all noobs in some aspects of this game. We don't know it all.