Coming from someone who grew up in it, it’s two different things. Think of graff as art and tagging as throwing up your alias to get your name seen or mess up someone’s piece. But okay :)
The dictionary disagrees with your folk distinction.
The dictionary isn't a language gatekeeper, however.
Either way, good neighborhoods don't have rampant tagging or graffiti. So what's going on there?
Portland would be a solid example of how distinguishing between the two is important. I wouldn't at all call it a bad area.
People are smiling and enjoying themselves within the confines of rampant tagging and graffiti in Capital Hill. People are fighting to live there these days. One negative is we have a missing mystery soda machine in the neighborhood.