The Sith deals in absolutes, the Jedi uses absolutes recreationally.

Actually it's more of a George Lucas is terrible at dialogue situation, the operative word in the sentence is "deals".

He wasn't saying "Only a Sith recognizes absolutes", he was saying they only "deal" in them as in they refuse to compromise or recognize nuance. To a Sith anyone that isn't currently aiding you is your enemy, if they aren't your ally they are to be destroyed. It's not that he was trying to say there are no absolutes, he's saying that there are other options in this situation, and that by viewing Obi-Wan as an enemy because he opposes Palpatine he is "dealing in absolutes" as in he is making this a life-or-death situation when it doesn't need to be.

It was never meant to be a philosophical statement, it's just a very awkward way of saying "Anakin we can work this out and compromise, you and Sidious are only acting like this because of the Dark Side". Unfortunately this bit of dialogue was written by the same person that thought "I'm haunted by the kiss that you should never have given me. My heart is beating...hoping that kiss will not become a scar" was romantic and thoughtful, instead of the type of thing an emo teenager would write in their diary.

If you want to see what George Lucas is capable of without someone there to fix his weird choices, go look up the "Adventures of Luke Starkiller, as taken from the Journal of the Whills, Saga I: The Star Wars" screenplay, the untouched version of Star Wars that he originally thought up, there are even comic book adaptations out there. If you are brave enough to read it, you will very quickly see that George needs someone else to proofread his work and ESPECIALLY his dialogue, because the entire thing is a mess and practically every other line out of someones mouth sounds like a grand philosophical statement because of the phrasing he uses to give it more gravitas.

TL;DR - George Lucas uses weird phrasing and should never be allowed to write dialogue.

Its because you dont cease to be a moral relativists just because you say certain words.

Imagine: Obiwan is a moral relativists and that is how he said this. What do his words mean then?

But Yoda secretly having an evil red sith lightsaber is the best part.

I think that at this point Yoda may also not have had the red one.

I have never been so incensed