It sounds odd to think that the Joker, one of the most unhinged of all villains, has any code of conduct that he won’t break. For one, he won’t join a Nazi party since he despises the idea. As crazed and as violent as he is, the Joker still believes in some sense of freedom and he doesn’t believe in discriminating when it comes to hurting people. That’s awkward to say really, but it’s a redeemable quality in some way. He also won’t harm those that can’t defend themselves, as there’s nothing funny in it. That makes it feel as though he’s not exactly principled, he’s just looking for a good laugh, which is true enough since that’s his whole gimmick, demented as it gets. But to think that the Joker has anything even approaching a moral code is funny in and of itself since the one thing he definitely stands for is chaos, and as most folks should know, chaos isn’t always bound to follow any code or string of ethics. This is where the Joker gets a little complicated though since there are things he won’t do and lines that he won’t cross, we just don’t get to see them that often.
Despite the fact that he’s a villain without remorse, the fact that he won’t be associated with those that would gladly eliminate entire races of people simply because of who they are is enough to make a person proud in a weird sort of way. Of course, it’s easy to go back to thinking that he’s demented and in many ways not to be trusted since after all he is a villain and someone that will kill a person so long as he can find the humor in it. But still, there’s that sigh of relief that he’s not about to turn around and become a genocidal maniac simply because he feels the need. There is the chance that he’d gladly kill a bunch of people because he finds it funny, but the idea that he’s not doing it just because they belong to a certain race is perversely pleasing in its own way. He’s still not a person to be trusted and definitely isn’t someone that you’d want to make friends with, but thinking that a villain has a limit they won’t cross is an oddity that a lot of people might have trouble with. Thinking of the Joker as a Nazi and finding out that he might think it’s funny to wipe out an entire race of people would be uniquely disturbing. But he’s found a hint of comedy in a lot of crimes throughout the length of his time in the comics, so it might have appeared to many people that nothing would be off-limits to him at any given point. This is where he draws the line apparently though, so to be certain, one can’t help but be confused and grateful at the same time.
The Joker has committed some pretty heinous crimes in his time, enough that he’d never be confused as a moral or even ethical person in any regard, so it does sound as though his refusal to ascribe to Naziism is more out of pride towards being an American and the fact that he doesn’t see the humor in genocide. He’s been more of a localized criminal anyway for many years, as despite the idea that he might practice his murderous habits anywhere he pleases, the Joker isn’t bound by much other than his own appetites and the habits that he’s formed throughout the length of his time as a criminal. He’s also been bound to pretty much one hero for a long time as well, and as Batman hasn’t had much to do with Nazis in the past it’s fair to say that the Joker hasn’t had to worry too much about them apart from certain moments in history when he might have run across them. But to be fair, a Nazi or white supremacist has nothing on the Joker since despite both of them being dangerous, the Joker is the far more unpredictable type since he’ll tend to kill someone if it makes a good joke and he’ll find the most inventive ways to do it. Also, there’s no telling what’s going to set the Joker off when it comes to deciding when and how he’ll kill those that he targets. Some of his kills he makes pretty obvious, but others are still kind of a guess at best.
To wrap it up though, the Joker is one of the villains that anyone might have thought would have qualms about anything since he’s pure chaos wrapped in human form most times, and trying to predict what he will or won’t do is difficult even for his longest-running enemy.